Economists' Outlook

Housing stats and analysis from NAR's research experts.

January 2018 Housing Affordability Index

At the national level, housing affordability is up from last month but down from a year ago. Mortgage rates dipped to 4.27 percent this January, down 2.5 percent compared to 4.38 percent a year ago.

  • Housing affordability declined from a year ago in January moving the index down 1.1 percent from 164.8 to 163.0. The median sales price for a single family home sold in January in the US was $241,700 up 5.7 percent from a year ago.
  • Nationally, mortgage rates were down 11 basis points from one year ago (one percentage point equals 100 basis points) while median family incomes rose 3.1 percent.

  • Regionally, the Midwest recorded the biggest increase in price at 9.0 percent. The West had an increase of 8.2 percent while the Northeast had a gain of 6.1 percent. The South had the smallest incline in price of 5.3 percent.
  • Regionally, three of the four regions saw a decline in affordability from a year ago. The South had a slight gain of 0.2 percent. The Midwest had the biggest decline of 4.2 percent. The West followed with a drop of 3.3 percent. The Northeast had the smallest decline of 2.4 percent.
  • On a monthly basis, affordability is up from last month in three of the four regions. The Northeast had the only decline of 3.8 percent. The Midwest had a gain of 1.5 percent followed by the West had an incline of 2.2 percent. The South had the biggest gain in affordability of 3.9 percent.
  • Despite month-to-month changes, the most affordable region was the Midwest, with an index value of 206.1. The least affordable region remained the West where the index was 114.0. For comparison, the index was 168.0 in the South, and 170.8 in the Northeast.

  • Mortgage applications are currently up 0.9 percent. Home prices are outpacing median family incomes. Lack of inventory is still having a negative impact on home prices. An increase in housing starts would ease the pressure of low inventory. Consumer confidence remains strong.
  • 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 (principal and interest payment to income). See further details on the methodology and assumptions behind the calculation here.