RISMEDIA, May 29, 2010—Nationwide housing, bolstered by favorable interest rates and low house prices, hovered for the fifth consecutive quarter near its highest level of affordability since the series was first compiled 19 years ago, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI).
The HOI showed that 72.2% of all new and existing homes sold in the first quarter of 2010 were affordable to families earning the national median income of $63,800, slightly higher than the previous quarter and near the record-high 72.5% set during the first quarter a year ago.
“Today’s report is very encouraging because it indicates that homeownership continues its more than year-long trend of remaining within reach of more households than it has for almost two decades,” said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. “With interest rates still hovering at low levels, companies starting to hire new employees and the economy beginning to rebound, this should encourage more home buyers to enter the market and help further stabilize housing and the economy.”
Indianapolis-Carmel and Youngstown-Warren-Boardman, Ohio-Pa., shared the ranking as the most affordable major housing markets in the country. In Indianapolis, which has held this top ranking for nearly five years, almost 95% of all homes sold were affordable to households earning the area’s median family income of $68,700. In Youngstown, the same percentage of homes were affordable to households earning a median $53,500.
Also near the top of the list of the most affordable major metro housing markets were Syracuse, N.Y.; Dayton, Ohio; and Grand Rapids-Wyoming, Mich.
Five smaller housing markets posted even higher affordability scores than Indianapolis and Youngstown. Among them, Bay City, Mich., where 98.7% of homes sold during the first quarter of 2010 were affordable to median-income earners, was the most affordable market in the country. Other smaller housing markets near the top of the index included Kokomo, Ind.; Davenport-Moline-Rock Island, Iowa-Ill.; Sandusky, Ohio; and Elkhart-Goshen, Ind., respectively.
New York-White Plains-Wayne, N.Y.-N.J., continued to lead the nation as its least affordable major housing market during the first quarter of 2010. Slightly less than 21% of all homes sold during the quarter were affordable to those earning the New York area’s median income of $65,600. This was the eighth consecutive quarter that the New York metropolitan division has occupied this position.
The other major metro areas near the bottom of the affordability scale included San Francisco; Honolulu; Santa Ana-Anaheim-Irvine, Calif.; and Los Angeles-Long Beach-Redwood City, Calif.
San Luis Obispo-Paso Robles, Calif. was the least affordable of the smaller metro housing markets in the country during the first quarter. Others near the bottom of the chart included Ocean City, N.J; Santa Cruz-Watsonville, Calif.; Napa, Calif.; and Flagstaff, Ariz.
For more information, visit www.nahb.org.
