NAHB Releases Housing Opportunity Index

Washington, DC, February 19, 2016—Modest home price and interest rate decreases resulted in a slight increase in nationwide housing affordability in the fourth quarter of 2015, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI).

In all, 63.3% of new and existing homes sold between the beginning of October and end of December were affordable to families earning the U.S. median income of $65,800. This up from the 62.2% of homes sold that were affordable to median-income earners in the third quarter.

The national median home price fell from $231,000 in the third quarter to $226,000 in the fourth quarter. Meanwhile, average mortgage rates edged lower from 4.18% to 4.09% in the same period.

Youngstown-Warren-Boardman, Ohio-Pennsylvania was rated the nation’s most affordable major housing market, switching places with Syracuse, New York, which fell to the second slot on the list. In Youngstown-Warren-Boardman, 90.1% of all new and existing homes sold in last year’s fourth quarter were affordable to families earning the area’s median income of $53,700.

Rounding out the top five affordable major housing markets in respective order were Scranton-Wilkes-Barre, Pennsylvania; Toledo, Ohio; and Columbia, South Carolina

Meanwhile, Binghamton, New York claimed the title of most affordable small housing market in the fourth quarter of 2015. There, 94.6% of homes sold during the fourth quarter were affordable to families earning the area’s median income of $66,400.

Smaller markets joining Binghamton at the top of the list included Cumberland, Maryland-West Virginia; Fairbanks, Alaska; Sandusky, Ohio; and Monroe, Michigan.

For the 13th consecutive quarter, San Francisco-San Mateo-Redwood City, California was the nation’s least affordable major housing market. There, just 10.4% of homes sold in the fourth quarter were affordable to families earning the area’s median income of $103,400.

Other major metros at the bottom of the affordability chart were located in California. In descending order, they included Los Angeles-Long Beach-Glendale; Santa Ana-Anaheim-Irvine; San Jose-Sunnyvale-Santa Clara; and Santa Rosa-Petaluma.

All five least affordable small housing markets were also in California. At the very bottom of the affordability chart was Santa Cruz-Watsonville, California, where 16.3% of all new and existing homes sold were affordable to families earning the area’s median income of $87,000. Other small markets at the lowest end of the affordability scale included Salinas; Napa, San Luis Obispo-Paso Robles; and Santa Barbara-Santa Maria-Goleta, respectively.