Economists' Outlook

Housing stats and analysis from NAR's research experts.

February 2016 Housing Affordability Index

While home price growth eased to a slower pace last month, at the national level, housing affordability is down from a year ago as rates are modestly higher and price growth continues to outstrip household income growth.

Housing affordability declined from a year ago in February pushing the index from 181.3 to 174.9. The median sales price for a single family home sold in February in the US was $212,300, up 4.3 percent from a year ago.

  • Nationally, mortgage rates were up 12 basis points from one year ago (one percentage point equals 100 basis points) while incomes rose approximately 2.1 percent. Income growth means the median family earns $118 more per month than February 2015.
  • Regionally, three of the four regions saw declines in affordability from a year ago. The Northeast had the only increase of 2.3 percent. The Midwest had the biggest decline in the affordability index of 6.1 percent followed by the West with 5.2 percent. The South had the smallest dip in affordability at 4.9 percent.
  • The West had the biggest increase in price at 7.4 percent while the Northeast experienced a slight decline in prices at -1.0 percent. The Midwest and the South had sizeable gains in prices of 6.3 percent and 4.5 percent increase in single family home prices, respectively.
  • By region, affordability is up in all regions from last month. The Northeast (2.7 percent) had the biggest increase and both the Midwest and South shared the smaller increase of (1.9 percent) and the West had the least at (1.8 percent).
  • Despite month to month changes, the most affordable region is the Midwest where the index is 223.8. The least affordable region remains the West where the index is 126.8.  For comparison, the index is 181.3 in the South, 177.4 in the Northeast.
  • Currently mortgage applications are up and rates have not made the jump as expected. A shortage of inventory is having an impact on sales across many metro markets. New homes sales would support this inventory issue and be assisted by increases in permits and land to build on, and hiring of construction workers.
  • What does housing affordability look like in your market? View the full data release here.
  • The Housing Affordability Index calculation assumes a 20 percent down payment and a 25 percent qualifying ratio (principle and interest payment to income). See further details on the methodology and assumptions behind the calculation here.

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