The share of homes affordable to families earning the U.S. median income fell sharply from the first quarter to the second quarter of 2021. The National Association of Home Builders says building material costs, high demand, and low inventory have pushed home prices up by tens of thousands of dollars. The NAHB/Wells Fargo Housing Opportunity Index found 63.1% of existing and new homes sold during the first quarter were affordable to median-income families, but that dropped to just 56.6% from April to the end of June. The national median home price is now $350,000.
This is the largest quarterly price hike in the history of this series. Meanwhile, average mortgage rates increased by 13 basis points in the second quarter to 3.09 percent from the rate of 2.96 percent in the first quarter.
Pittsburgh, Pa. was the nation’s most affordable major housing market, defined as a metro with a population of at least 500,000. In Pittsburgh, 90.6 percent of all new and existing homes sold in the second quarter were affordable to families earning the area’s median income of $84,800.
Meanwhile, Cumberland-Md.-W.Va., was rated the nation’s most affordable smaller market, with 94.0 percent of homes sold in the second quarter being affordable to families earning the median income of $60,800.