Nationwide Housing Affordability Reaches New Record High Tight Credit Remains Primary Obstacle for Buyers
WASHINGTON, May 17 - Nationwide housing affordability hit a new record
high for a second consecutive quarter in the first three months of this
year, according to the National Association of Home Builders/Wells Fargo
Housing Opportunity Index (HOI), released today. Yet tight lending
conditions continue to pose a major obstacle to many prospective home
The latest HOI data reveal that 77.5 percent of all new and existing
homes that were sold in this year's first quarter were affordable to
families earning the national median income of $65,000. This beats the
previous record set in the final quarter of 2011, when 75.9 percent of
homes sold were affordable to median-income earners.
"Homes in this year's first quarter were more affordable than they have
been at any time in more than 20 years, yet many potential sales are not
happening because of overly tight lending conditions that are keeping
hardworking families from obtaining a suitable mortgage," said Barry
Rutenberg, chairman of the National Association of Home Builders (NAHB)
and a home builder from Gainesville, Fla. "Without this significant
hurdle, the housing and economic recovery could be proceeding at a much
The most affordable major housing market in this year's first quarter
was Indianapolis-Carmel, Ind., where 95.8 percent of homes sold during
the period were affordable to households earning the area's median
family income of $66,900.
Also ranking among the most affordable major housing markets in
respective order were Dayton, Ohio; Lakeland-Winter Haven, Fla.;
Modesto, Calif.; Grand Rapids-Wyoming, Mich.; and Buffalo-Niagara Falls,
N.Y.; the latter two of which tied for fifth place.
Among smaller housing markets, Cumberland, Md.-W.Va. topped the
affordability chart for the first time in this year's first quarter.
There, 99 percent of homes sold during the first quarter were affordable
to families earning the area's median income of $53,000. Other smaller
housing markets at the top of the index include Fairbanks, Alaska;
Wheeling, W.Va.; Kokomo, Ind.; and Davenport-Moline-Rock Island,
In New York-White Plains-Wayne, N.Y.-N.J., which retained the title of
the least affordable major housing market for a 16th consecutive
quarter, just 31.5 percent of homes sold in the first three months of
this year were affordable to those earning the area's median income of
Other major metros at the bottom of the affordability chart included San
Francisco-San Mateo-Redwood City, Calif.; Honolulu; Los Angeles-Long
Beach-Glendale, Calif.; and Santa Ana-Anaheim-Irvine, Calif.,
Ocean City, N.J., was the least affordable smaller housing market on the
list, with 45.9 percent of homes sold in the first quarter affordable to
families earning the median income of $71,100. Other small metros at the
bottom of the list included Santa Cruz-Watsonville, Calif.; San Luis
Obispo-Paso Robles, Calif.; Santa Barbara-Santa Maria-Goleta, Calif.;
and Laredo, Texas.
Please visit www.nahb.org/hoi for tables, historic data and details.
EDITOR'S NOTE: The NAHB/Wells Fargo Housing Opportunity Index is a
measure of the percentage of homes sold in a given area that are
affordable to families earning that area's median income during a
specific quarter. Prices of new and existing homes sold are collected
from actual court records by First American Real Estate Solutions, a
marketing company. Mortgage financing conditions incorporate interest
rates on fixed- and adjustable-rate loans reported by the Federal
Housing Finance Board.
The NAHB/Wells Fargo HOI is strictly the product of NAHB Economics, and
is not seen or influenced by any outside party prior to being released
to the public.
ABOUT NAHB: The National Association of Home Builders is a
Washington-based trade association representing more than 140,000
members involved in remodeling, home building, multifamily construction,
property management, subcontracting, design, housing finance, building
product manufacturing and other aspects of residential and light
commercial construction. NAHB is affiliated with 800 state and local
home builders associations around the country. NAHB's builder members
will construct about 80 percent of the new housing units projected for
1201 15th Street NW, Washington, DC, 20005