In the first quarter of this year, housing affordability continued to hold near its historic highs, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index.
From the beginning of January to the end of March, 73.7 percent of new and existing homes sold were affordable to families earning the U.S. median income of $64,400, NAHB reports. That is down slightly from 74.9 percent in the fourth quarter of 2012.
Low mortgage rates continue to be a main driver of housing affordability over the past four years, says NAHB Chairman Rick Judson.
However, “from a builder’s perspective, it should be noted that rising costs for building materials, lots and labor are making it somewhat more expensive to construct new homes in today’s market,” Judson says.
5 Most Affordable Major Housing Markets
1. Ogden-Clearfield, Utah: 93.4% of all new and existing homes sold there in the first quarter were affordable to families earning the area’s median income of $70,800
2. Indianapolis-Carmel, Ind.
3. Lakeland-Winter Haven, Fla.
4. Youngstown-Warren-Boardman, Ohio-Pa.
5. Syracuse, N.Y. (tied)
Albany-Schenectady-Troy, N.Y. (tied)
5 Least Affordable Major Housing Markets
1. San Francisco-San Mateo-Redwood City, Calif.: only 28.9 percent of homes sold in the first quarter there were affordable to families earning the median income of $102,000
2. New York-White Plains-Wayne, N.Y.-N.J.
3. Santa Ana-Anaheim-Irvine, Calif.
4. Los Angeles-Long Beach-Glendale, Calif.
5. San Jose-Sunnyvale-Santa Clara, Calif.
The National Association of REALTORS® will release its next report on housing affordability June 7. To view NAR’s housing affordability research, visit REALTOR.org.
Source: National Association of Home Builders