Housing Affordability June

Affordability Slips as Home Values Strengthen

Nationwide housing affordability slipped several notches as recovering markets witnessed significant firming of home prices in the second quarter, according to the NAHB/Wells Fargo Housing Opportunity Index (HOI), released on Aug. 13. In all, 69.3% of new and existing homes sold between the beginning of April and end of June were affordable to families earning the U.S. median income of $64,400. This is down from the 73.7% of homes sold that were affordable to median-income earners in the first quarter, and the first time that the measure has fallen below 70% since late 2008. Rising home prices signal the improving health in housing markets, and the median price of all new and existing U.S. homes sold in this year’s second quarter, at $202,000, was well ahead of the second quarter 2012 median price of $185,000. “Together with rising mortgage rates, this contributed to affordability slipping to the lowest level in more than four years,” said NAHB Chief Economist David Crowe. 

Rockford, IL is the 23rd most affordable housing market in the nation where 90.4% of the houses sold with a median value of $100,000 could have been bought by a family with the local median family income of $61,100.