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| Daren Blomquist |
IRVINE, CA –— ATTOM
Data Solutions, curator of the nation’s
premier property database, released its Q2 2018 U.S. Home Affordability Report,
which shows that the U.S. home prices in the first quarter were at the least
affordable level since Q3 2008.
The report calculates
an affordability index based on percentage of income needed to buy a
median-priced home relative to historic averages, with an index above 100
indicating median home prices are more affordable than the historic average,
and an index below 100 indicating median home prices are less affordable than
the historic average.
Nationwide, the Q2 2018
home affordability index of 95 was down from an index of 102 in the previous
quarter and an index of 103 in Q2 2017 to the lowest level since Q3 2008, when
the index was 86.
“Slowing home price
appreciation in the second quarter was not enough to counteract an 11 percent
increase in mortgage rates compared to a year ago, resulting in the worst home
affordability we’ve seen in nearly 10 years,” said Daren Blomquist,
senior vice president at ATTOM Data Solutions.
“Meanwhile home price
appreciation continued to outpace wage growth, speeding up the affordability
treadmill for prospective homebuyers even without the rise in mortgage rates.”
Nationwide the median
home price of $245,000 in Q2 2018 was up 4.7 percent from a year, down from 7.4
percent appreciation in the first quarter but still above the average weekly
wage growth of 3.3 percent.
Since bottoming out in Q1 2012, median
home prices nationwide have increased 75 percent while average weekly wages
have increased 13 percent during the same period.
Annual growth in median
home prices outpaced average wage growth in 275 of the 432 counties analyzed in
the report (64 percent), including Los Angeles County, California; Maricopa
County (Phoenix), Arizona; San Diego County, California; Orange County,
California; and Miami-Dade County, Florida.
Counties with the
lowest home affordability indexes in Q2 2018 were Genesee County (Flint),
Michigan (70); Denver County, Colorado (72); Adams County (Denver area),
Colorado (73); Santa Fe County, New Mexico (73); and Wilson County (Nashville
area), Tennessee (75).
Among 40 counties with
a population of at least 1 million, those with the lowest home affordability
indexes in Q2 2018 were Travis County (Austin), Texas (77); Alameda County (San
Francisco area), California (81); Santa Clara County (San Jose), California (82);
Oakland County (Detroit area), Michigan (82); and San Francisco County,
California (83).
Nationwide an average
wage earner would need to spend 31.2 percent of his or her income to buy a
median-priced home in Q2 2018, above the historic average of 29.6 percent.
Counties with median
home prices requiring the highest share of average wage earner income were
Marin County (San Francisco area), California (133.2 percent); Kings County (Brooklyn),
New York (123.1 percent); Santa Cruz County, California (121.5 percent);
Monterey County (Salinas), California (100.3 percent); and San Francisco
County, California (97.2 percent).
Counties with median
home prices requiring the lowest share of average wage earner income were Wayne
County (Detroit), Michigan (13.5 percent); Clayton County, Georgia (13.7
percent); Rock Island (Quad Cities), Illinois (15.8 percent); Saginaw County,
Michigan (16.4 percent); and Richmond County (Augusta), Georgia (16.4 percent).
An average wage earner
would not qualify to buy a median-priced home in 326 of the 432 counties (75
percent) analyzed in the report based on a 3 percent down payment and a maximum
front-end debt-to-income ratio of 28 percent.
Counties where an
average wage earner could not afford to buy a median-priced home in Q2 2018
included Los Angeles County, California; Cook County (Chicago), Illinois;
Maricopa County (Phoenix), Arizona; San Diego County, California; and Orange
County, California.
For more information, please contact:
Christine Stricker
949.748.8428
Data and Report
Licensing:
949.502.8313
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