At the national level, housing affordability is up for the month of February due to an increase in home prices and minimal movement in wages. What is affordability like in your market?
- Housing affordability is up for the month of February as the median price for a single family home in the US increased slightly by 0.7% from January. The median single-family home price is $189,200, up 9.0 % from a year ago. Affordability is down from 209.8 in February 2013 to 175.7 in February 2014.
- Mortgage rates are up 91 basis points (one percentage point equals 100 basis points) from last year, nationally. Income levels are up 1.9% from last year. A balance of income and job growth will improve affordability options.
- By region, affordability is up slightly from one month ago in the Northeast and the Midwest, but the West and the South had a minor drop in affordability. The Northeast was the only region to have declines in home prices but a slight increase in mortgage rates. From one year ago, affordability is down in all regions. The West saw the biggest decline in affordability as a result of having the largest price gain at 17.0%.
- Improvements in underwriting will increase consumer confidence and bring more first-time home buyers into the market. The spring months have a tendency to see increased foot traffic, helping sales trend up and minimizing delays in transactions.
- What does housing affordability look like in your market? View the full data release here.
- The Housing Affordability Index calculation assumes a 20 percent down payment and a 25 percent qualifying ratio (principle and interest payment to income). See further details on the methodology and assumptions behind the calculation here.