At the national level, housing affordability is down for the month of May and lower than a year ago due to a rise in home prices and slower rising mortgage rates.
- Housing affordability is down for the month of May as the median price for a single family home in the US increased. The median single-family home price is $213,600, up 4.9 % from a year ago. Price gains are continuing to slow down.
- Mortgage rates are up 77 basis points (one percentage point equals 100 basis points) from last year. Nationally, affordability is down from 179.3 in May 2013 to 159.3 in May 2014.
- While jobs and income levels are up slightly from last year, they are not growing fast enough to offset price increases. Having money for a down payment can still be a big hurdle for potential home buyers who already pay comparable rent payments.
- Affordability is down slightly from one month ago in all regions. The South had the biggest drop in affordability. 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 8.4 %.
- With rents at a five year high and housing completions low, potential home buyers have good incentives to try to become a home owner.
- 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.