Home affordability was at its highest in two years in the first quarter of 2020.
ATTOM Data Solutions reported Thursday that that median home prices in the first quarter of 2020 are unaffordable for average wage earners in 319 of 483, or 66% of the US counties analyzed in the report.
Although still high, the figure is down from 70.4% in the fourth quarter of 2019 and 69.8% from the first quarter of 2019.
With the US median home price of $252,500, owning one costs 31.1% of the national average wage. That’s down from 31.4% in the previous quarter and from 31.6% in the first quarter of 2019. It was the lowest share since Q4 2017 (30.8%).
"Home affordability has inched ahead this year across the United States as buying a house or a condo gets closer and closer to the level where the average wage earner can swing the deal within standard lending guidelines. While the national median price still remains a bit out of reach for the average wage earner, the affordability gap has narrowed to the smallest point in more than two years," said Todd Teta, chief product officer with ATTOM Data Solutions. "It seems bizarre that median home prices have risen 8% over the past 12 years while average wages grew by less than half that amount. But falling interest rates continue making up the difference, dropping monthly home ownership payments in a majority of the country."
Annual home price appreciation is outpacing average weekly wage growth in the first quarter of 2020 in 309 of the 483 counties analyzed in the report (64%), with the largest counties including Los Angeles County, CA; Maricopa County (Phoenix), AZ; San Diego County, CA; Orange County, CA (in the Los Angeles, CA metropolitan statistical area) and Miami-Dade County, FL.