![](\"https:\/\/www.floridarealtors.org\/sites\/default\/files\/styles\/full_width_main_image\/public\/page\/image\/2020-02\/gettyimages-1017225726.jpg?h=40061d28&itok=bSQHceeK\")
<\/p>\n<\/p>\n
NAHB\u2019s 2Q comparison of selling prices ($388,000, nationally) to median incomes ($96,300) found only 40.5% of U.S. residents can afford a home at that price.<\/span><\/span><\/p>\n<\/div>\n WASHINGTON \u2013 Rising home prices and interest rates coupled with elevated construction costs, low existing inventory and solid demand resulted in a significant decline in housing affordability during the second quarter of 2023. <\/span><\/span><\/p>\n According to the National Association of Home Builders (NAHB)\/Wells Fargo Housing Opportunity Index (HOI), 40.5% of new and existing homes sold between the beginning of April and end of June (second quarter, or 2Q) were affordable to families earning the U.S. median income of $96,300.<\/span><\/span><\/p>\n That\u2019s an affordability drop, down from 45.6% posted in the first quarter of 2023, and the second-lowest reading since NAHB began tracking affordability on a consistent basis in 2012. The HOI is also down year-to-year. In the second quarter 2022, the HOI was 42.8%.<\/span><\/span><\/p>\n \u201cWhile builders continue to face a number of affordability challenges \u2026 they remain cautiously optimistic about market conditions,\u201d says NAHB Chairman Alicia Huey. \u201cA lack of existing inventory is fueling demand for new construction, and mortgage rates are expected to stabilize in the weeks and months ahead as the Federal Reserve nears the end of its tightening cycle.\u201d <\/span><\/span><\/p>\n \u201cRising mortgage rates in 2023 that peaked near 7% recently have been a major factor in declining affordability conditions,\u201d says NAHB Chief Economist Robert Dietz. \u201cGiven the Fed\u2019s limited ability to address rising construction costs, the best way to satisfy unmet demand and ease the nation\u2019s housing affordability crisis is to enact policies that will allow builders to construct more homes.\u201d <\/span><\/span><\/p>\n According to the HOI, the national median home price increased to $388,000 in 2Q from $365,000 1Q. Meanwhile, average mortgage rates were 6.59% in 2Q, up from 6.46% in 1Q. <\/span><\/span><\/p>\n Lansing-East Lansing, Mich., was the nation\u2019s most affordable major housing market, defined as a metro with a population of at least 500,000. There, 84% of all new and existing homes sold in the second quarter were affordable to families earning the area\u2019s median income of $97,800. <\/span><\/span><\/p>\n Top five affordable major housing markets<\/strong><\/span><\/span><\/p>\n Meanwhile, Cumberland, Md.-W.Va., was rated the nation\u2019s most affordable small market, with 95.5% of homes sold in the second quarter being affordable to families earning the median income of $89,900. <\/span><\/span><\/p>\n Top five affordable small housing markets<\/strong><\/span><\/span><\/p>\n For the 11th straight quarter, Los Angeles-Long Beach-Glendale, Calif., remained the nation\u2019s least affordable major housing market. There, just 3.2% of the homes sold during the second quarter were affordable to families earning the area\u2019s median income of $97,500. <\/span><\/span><\/p>\n Top five least affordable major housing markets (All in California)<\/strong><\/span><\/span><\/p>\n The top five least affordable small housing markets were also in the Golden State. Tied at the very bottom of the affordability chart were Salinas, Calif., and San Luis Obispo-Paso Robles, Calif., where 6.5% of all new and existing homes sold in the second quarter were affordable to families earning the area median income of $100,400 in Salinas and $113,100 in San Luis-Obispo-Paso Robles. <\/span><\/span><\/p>\n Top five least affordable small housing markets (all in California)<\/strong><\/span><\/span><\/p>\n \u00a9 2023 Florida Realtors\u00ae<\/span><\/span><\/p>\n<\/div><\/div>\n <\/p>\n <\/p>\n\n\u00a02Q: Most and least affordable markets<\/span><\/span><\/h3>\n
\n
\n
\n
\n