Lower interest rates helped make homes more affordable to median-income families even as house prices continued to inch up in metro areas across the country in the third quarter, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI).
Nationwide, 74.1 percent of all homes sold in this year's third quarter were affordable to families earning the U.S. median income of $65,000. This was up slightly from the 73.8 percent of homes sold that were affordable to median-income earners in the second quarter.
"The latest housing affordability data is good news on two fronts, because it shows that the share of homes affordable to median-income earners has risen even as home prices have continued to gradually recover from their recession lows," said NAHB chairman Barry Rutenberg, a home builder from Gainesville, Fla., in a statement. "This is primarily due to the fact that mortgage rates are now lower than we've seen them since the HOI was initiated more than a decade ago.”
Topping the affordability list for the first time in the HOI's history, Ogden-Clearfield, Utah, was named the most affordable major housing market in the country in the third quarter. There, 93.2 percent of all new and existing homes sold between July and September of this year were affordable to families earning the area's median household income of $71,500.
Also ranking among the most affordable major housing markets in respective order were Youngstown-Warren-Boardman, Ohio-Pa; Indianapolis-Carmel, Ind.; Lakeland-Winter Haven, Fla.; and Toledo, Ohio.
Among smaller housing markets, Fairbanks, Alaska, retained its standing at the top of the affordability chart with an incredible 99.4 percent of all homes sold there in the third quarter being affordable to families earning the area's median income of $92,900.
Other smaller housing markets at the top of the index included Mansfield and Lima, Ohio; Wheeling, W.Va.-Ohio; and Kokomo, Ind.
Meanwhile, New York-White Plains-Wayne, N.Y.-N.J. retained the title of the least affordable major housing market in the country for an 18th consecutive quarter, with just 28.5 percent of homes sold there being affordable to families earning the area's median income of $68,300.
For more information, visit www.nahb.org/hoi
for tables, historical data and details.