As home prices skyrocketed home affordability got worse in the third quarter of 2021, according to the ATTOM data solutions quarterly report…(ATTOM)
- Q-O-Q: Homes are less affordable in 75% of counties across the country compared to their historical averages. This is a 14 percentage point increase from the second quarter.
- Y-O-Y: Home affordability is now 21 percentage points worse than it was in the third quarter of 2020.
REMEMBER: Affordability is defined by looking at average wage earners and calculating homeownership for a median single-family home.
GOOD NEWS: Despite affordability issues, total home costs are still under the 28% standard preferred by most lenders…
- Q-O-Q: Total ownership costs on the typical home now consume 24.9% of the average national wage of $64,857 an increase of 0.6 percentage points from the second quarter.
- Y-O-Y: Total ownership costs are up 2.6 percentage points from the third quarter of 2021.
Todd Teta, chief product officer with ATTOM, said that home prices remain affordable but we are getting close to the tipping point…
- “The typical median-priced home around the U.S. remains affordable to workers earning an average wage…But affordability keeps inching in the wrong direction as the housing market boom keeps roaring ahead. That’s pushing average workers closer and closer to the point where lenders might be reluctant to give them a mortgage.”
