Housing affordability is worsening nationwide, beyond just the coastal markets. The median home price was not affordable to the average wage earner in 68 percent of counties tracked in the first quarter of 2018, according to a new report by ATTOM Data Solutions.
ATTOM researchers determined affordability for average wage earners by calculating the amount of income needed to make a monthly house payment (including mortgage, property taxes, and insurance) on a median-priced home. Researchers factored in an assumed 3 percent down payment and 28 percent maximum debt-to-income ratio.
“Coastal markets are the epicenter of the U.S. home affordability crisis, but affordability aftershocks are now being felt further inland as housing refugees migrate from the high-cost coastal markets to lower-priced markets in the middle of the country where good jobs are available,” says Daren Blomquist, senior vice president with ATTOM Data Solutions. “That in turn is pushing home prices above historically normal affordability limits in those middle-America markets.”
Forty-one percent of the 446 counties analyzed in the report were less affordable than their historic affordability averages in the first quarter of 2018, up from 24 percent a year ago. Some of the counties where that was most prominent are: Los Angeles, Calif.; Harris County (Houston), Texas; San Diego County, Calif.; Kings County (Brooklyn), N.Y.; and Dallas County, Texas.