ATTOM: Homes Remain Unaffordable in Q1

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ATTOM, Irvine, Calif., released its Q1 Home Affordability Report, finding that homes were less affordable than historical averages in 97% of counties with sufficient data to analyze for Q1.

The national median home price has increased by 8% from $333,438 to $360,000 year-over-year, but average weekly wages only increased by 6.4%.

Median home prices rose year-over-year in 61.7% of the 580 counties analyzed.

In 69.1% of the 580 counties ATTOM analyzed, major monthly home expenses exceeded 28% of the typical resident’s wages. In fact, major monthly expenses on a median priced home would have consumed 30.3% of the typical worker’s wages, down narrowly from 30.6% in Q4 and down 31.6% year-over-year.

To afford a medium priced home and keep monthly expenses below the usually accepted 28%, a buyer would have to earn $84,230 annually.

“Over the last several years, wages haven’t kept up with rising home prices in many markets,” said Rob Barber, CEO of ATTOM. “Mortgage rates dropped throughout last year, which offset some of that growing affordability gap, but shifts in the broader economic environment can still influence rates and home purchasing power.”

Unaffordable markets vary by area–of the 25 counties where major monthly home expenses consumed the greatest share of residents’ average wages, 14 were in California, four were in New York, three were in New Jersey and two were in Hawaii.