IRVINE, Calif., March 26, 2020 /PRNewswire/ -- ATTOM Data
Solutions, curator of the nation's premier property database and
first property data provider of Data-as-a-Service (DaaS), today
released its first-quarter 2020 U.S. Home Affordability Report,
which shows that median home prices in the first quarter of 2020
are unaffordable for average wage earners in 319 of 483, or 66
percent of the U.S. counties analyzed in the report. But that
figure is down from 70.4 percent in the fourth quarter of 2019 and
69.8 percent from the first quarter of 2019.
The report also shows that owning a median-priced home in the
first quarter of 2020 in the United
States – costing $252,500 –
consumes 31.1 percent of the national average wage. That percentage
is down from 31.4 percent in the fourth quarter of 2019 and 31.6
percent in the first quarter of 2019, to the lowest percentage
since the fourth quarter of 2017, when the average workers were
spending 30.8 percent of wages to own a home.
The report determined affordability for average wage earners by
calculating the amount of income needed to make monthly house
payments — including mortgage, property taxes and insurance — on a
median-priced home, assuming a 3 percent down payment and a 28
percent maximum "front-end" debt-to-income ratio. That required
income was then compared to annualized average weekly wage data
from the Bureau of Labor Statistics (see full methodology
below).
View Q1 2020 U.S. Home Affordability Heat Map
"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 percent 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."
"All that may change in a huge way over the next few months as
the impact of the coronavirus hits the housing market. We are
entering a period of great uncertainty," he added. "But in the
initial months of the year, the picture has appeared to continue to
brighten for home seekers."
The most populous counties where a median-priced home in the
first quarter of 2020 was not affordable for average wage earners
include 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. The report analyzed 483
counties with a population of at least 100,000 and at least 100
homes sales in the first quarter of 2020.
The 164 counties (34 percent) where a median-priced home in the
first quarter of 2020 is affordable for average wage earners
include Cook County (Chicago) IL; Harris
County (Houston), TX;
Dallas County, TX; Wayne County (Detroit), MI and Philadelphia County, PA.
Home price appreciation outpacing wage growth in 64 percent
of markets
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 percent), 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.
Average annualized wage growth is outpacing home price
appreciation in 174 of the 483 counties (36 percent), including
Cook County (Chicago), IL; Harris
County (Houston), TX;
Queens County, NY; King County (Seattle), WA and Tarrant County (Fort
Worth), TX.
At least 30 percent of wages needed to buy a home in more
than half of markets
Among the 483 counties analyzed in the
report, 288 (59.6 percent) currently require at least 30 percent of
their annualized weekly wages to buy a home. Those counties that
require the greatest percent of wages include Kings County (Brooklyn), NY (108.1 percent of annualized
weekly wages needed to buy a home); Santa
Cruz County, CA (in the San
Jose metro area) (92.8 percent); Marin County, CA (in the San Francisco metro area) (91.5 percent);
Maui County, HI (88.5 percent) and
Monterey County, CA (in the
San Francisco metro area) (86.8
percent).
A total of 195 counties in the report (40.4 percent) require
less than 30 percent of their annualized weekly wages to buy a
home. Those counties that require the smallest percent include
Baltimore City/County, MD (9.5
percent of annualized weekly wages needed to buy a home);
Madison County, IN (in the
Indianapolis metro area) (10.8
percent); Bibb County, GA (in the
Macon metro area) (11.4 percent);
Calhoun County, MI (in the
Battle Creek metro area) (11.7
percent) and Rock Island County,
IL (in the Davenport metro area) (12.4 percent).
Two-thirds of markets more affordable than historic
averages
Among the 483 counties in the report, 323 (66.9
percent) are more affordable than their historic affordability
averages in the first quarter of 2020, up from 55.1 percent in the
fourth quarter of 2019 and 49.7 percent from the first quarter of
2019.
Counties with the highest affordability indexes are Madison County, IN (in the Indianapolis metro area) (index of 186);
Baltimore City/County, MD (159);
Mercer County, NJ (in the
Trenton metro area) (159);
Peoria County, IL (149) and
Onslow County, NC (in the
Jacksonville metro area)
(145).
Counties with at least 1 million people that are more affordable
than their historic averages (indexes of at least 100 are
considered more affordable compared to their historic averages)
include Cook County (Chicago), IL (index of 128); Montgomery County, MD (in the Washington, DC, metro area) (122);
New York County (Manhattan), NY (118); Fairfax County, VA (in the Washington, DC, metro area) (117) and
Cuyahoga County (Cleveland), OH (116).
The biggest annual gains among other counties include
Johnson County, IN (in the
Indianapolis metro area) (index up
41 percent); Butte County, CA (in
the Chico metro area) (up 36
percent); Niagara County, NY (in
the Buffalo metro area) (up 35 percent); Onondaga County, NY (in the Syracuse metro area) (up 27 percent) and
Saint Clair County, IL (in the
St. Louis, MO, metro area) (up 26
percent).
Counties with at least 1 million people that saw the biggest
annual improvement in their affordability indexes include
New York County (Manhattan), NY (index up 23 percent);
Bronx County, NY (up 19 percent);
King County (Seattle), WA (up 14 percent); Alameda County (Oakland), CA (up 13 percent) and Contra Costa County, CA (in the San Francisco metro area) (up 12 percent).
One-third of markets less affordable than historic
averages
Among the 483 counties analyzed in the report with
a population of at least 100,000 and at least 100 home sales in the
first quarter of 2020, 160 (33.1 percent) are less affordable than
their historic affordability averages in the first quarter of 2020,
down from 44.9 percent of counties in the previous quarter and 50.3
percent of counties in the first quarter of 2019.
Counties with the lowest affordability indexes include
Canyon County, ID (in the
Boise metro area) (index of 74);
Orleans Parish (New Orleans), LA (80); Ada County, ID (in the Boise metro area) (80); Benton County, WA (east of Portland, OR) (81) and Genesee County, MI (in the Flint metro area)
(82).
Counties with a population greater than 1 million that are less
affordable than their historic averages (indexes of less than 100
are considered less affordable compared to their historic averages)
include Wayne County (Detroit), MI (index of 86); Tarrant County (Fort
Worth), TX (88); Dallas County,
TX (90); Salt Lake County
(Salt Lake City), UT (92) and
Maricopa County (Phoenix), AZ (93).
Counties with the biggest year-over-year decreases in their
affordability indexes are Madison County,
IN (in the Indianapolis
metro area) (down 54 percent); Bibb
County, GA (in the Macon
metro area) (down 17 percent); Warren
County, NJ (in the Allentown,
PA, metro area) (down 16 percent); Saint Louis City/County, MO (down 15 percent)
and Erie County, PA (down 14
percent).
Among the counties with at least 1 million people, the only ones
with a decline in their annual affordability indexes in the first
quarter of 2020 are Philadelphia County,
PA (index down 3 percent); Wayne
County (Detroit), MI (down
1 percent); Suffolk County, NY (in
the New York City metro area)
(down 1 percent) and Mecklenburg County,
NC (in the Charlotte metro
area) (down 0.4 percent)
Report Methodology
The ATTOM Data Solutions U.S. Home
Affordability Index analyzes median home prices derived from
publicly recorded sales deed data collected by ATTOM Data Solutions
and average wage data from the U.S. Bureau of Labor
Statistics in 483 U.S. counties with a combined population of
235 million. The affordability index is based on the percentage of
average wages needed to make monthly house payments on a
median-priced home with a 30-year fixed rate mortgage and a 3
percent down payment, including property taxes, home insurance and
mortgage insurance. Average 30-year fixed interest rates from the
Freddie Mac Primary Mortgage Market Survey were used to
calculate the monthly house payments.
The report determined affordability for average wage earners by
calculating the amount of income needed to make monthly house
payments — including mortgage, property taxes and insurance — on a
median-priced home, assuming a 3 percent down payment and a 28
percent maximum "front-end" debt-to-income ratio. For instance, the
nationwide median home price of $252,500 in the first quarter of 2020 would
require an annual gross income of $65,107 for a buyer putting 3 percent down and
not exceeding the recommended "front-end" debt-to-income ratio of
28 percent — meaning the buyer would not be spending more than 28
percent of his or her income on the house payment, including
mortgage, property taxes and insurance. That required income is
lower than the $58,708 annual wages
earned by an average worker in the United
States based on the most recent average weekly wage data
available from the Bureau of Labor Statistics, making a
median-priced home nationwide not affordable for an average wage
earner.
About ATTOM Data Solutions
ATTOM Data
Solutions provides premium property data to power
products that improve transparency, innovation, efficiency and
disruption in a data-driven economy. ATTOM multi-sources property
tax, deed, mortgage, foreclosure, environmental risk, natural
hazard, and neighborhood data for more than 155 million U.S.
residential and commercial properties covering 99 percent of the
nation's population. A rigorous data management process involving
more than 20 steps validates, standardizes and enhances the data
collected by ATTOM, assigning each property record with a
persistent, unique ID — the ATTOM ID. The 9TB ATTOM Data Warehouse
fuels innovation in many industries including mortgage, real
estate, insurance, marketing, government and more through flexible
data delivery solutions that include bulk file licenses, property
data APIs, real estate market trends, marketing lists, match
& append and introducing the first property data delivery
solution, a cloud-based data platform that streamlines data
management – Data-as-a-Service (DaaS).
Media Contact:
Christine
Stricker
949.748.8428
christine.stricker@attomdata.com
Data and Report Licensing:
949.502.8313
datareports@attomdata.com
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SOURCE ATTOM Data Solutions