Housing affordability continued to fall across the country as the median price of single-family homes rose due to a continued lack of housing inventory, according to the latest National Association of Realtors Housing Affordability Index. The median single-family home price was $198,200 in March, up 7.4 percent from year-ago levels.
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What’s more, mortgage rates are higher than last year. Income levels rose 2.1 percent from last year. “An increase in inventory along with price stabilization will improve affordability,” according to NAR’s Economists’ Outlook blog.
Affordability is down in all regions across the country, but the West saw the biggest drops in affordability due to a 12.5 percent price gain.
Still, more than 63 percent of homes sold in the first three months of the year were affordable to buyers earning the U.S. median income of $63,900, according to a new analysis by the National Association of Home Builders. In some markets, the income needed to qualify is a fraction of that.
The following housing markets are known as the most affordable markets in the nation for a median-priced home, where buyers need less than $21,000 in income to qualify for a mortgage when putting 5 percent down.
Meanwhile, the least affordable markets were San Jose-Sunnyvale-Santa Clara, Calif. (where a buyer would need an income of $186,285 to qualify), followed by San Francisco-Oakland-Fremont, Calif. ($156,728); Honolulu ($154,999); and Anaheim-Santa Ana-Irvine, Calif. ($154,423).