Spring Sees Dive in Housing Affordability

June 17, 2014

The average family found homes to be a little less affordable in April, as home prices continued to rise while incomes and mortgage rates remained stagnant, according to the latest reading from the National Association of REALTORS®’ Housing Affordability Index.

The median price of a single-family home was $201,100 in April, up 4.7 percent from a year ago. However, the affordability picture may improve in the coming months as price gains show signs of slowing nationwide.

Also, “new home construction could help low inventory levels and slow price growth, which may make buying more attractive than renting,” economists wrote at NAR’s Economists’ Outlook blog.

Income levels have mostly remained flat the past year, up 2.3 percent from last year.

Regionally, housing affordability was up slightly from a month ago in the Northeast but was down in the other three regions. The West had the largest decrease in affordability compared to year-ago levels, largely because the region saw some of the highest price gains of any other region, at 8.7 percent.

Source: “Latest Housing Affordability Index Data Release,” National Association of REALTORS® Economists’ Outlook Blog (June 16, 2014)

Read more:

Most States Face Long-Term Affordability Crisis
Housing Affordability Slips, But Not Everywhere
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