As rising home prices continue to outpace income gains, homeowners across the nation are finding it more difficult to buy, according to the National Association of Realtors’ latest reading of its Housing Affordability Index.
The median price for a single-family home in the U.S. is up 5.8 percent from a year ago, at $235,500 as of July. The King County median in August was nearly double that at $450,700.
“Housing markets with low inventory levels may continue to experience rising home prices,” wrote Michael Hyman, NAR research data specialist. “However, improvement in job creation and steady income gains help offset major price growth. Mortgage applications are currently down for new and existing homes which could be seasonal or a sign that rising rates are having an impact on affordability.”
Affordability has fallen from one month ago in all regions of the United States, with the West posting the largest drop in the affordability index (2.1 percent). Compared to a year ago, affordability has fallen in all regions, except the Northeast which saw a 2 percent increase. The West again posted the largest decline in affordability year-over-year at 4.3 percent.
The Western region of the country has seen the largest year-over-year increases in prices at 8.4 percent, followed by the South at 7.1 percent and Midwest at 6.5 percent. The Northeast saw the slowest price growth at 1.8 percent, according to NAR.