Economists' Outlook

Housing stats and analysis from NAR's research experts.

March 2017 Housing Affordability Index

At the national level, housing affordability is down from last month and down from a year ago. Mortgage rates increased to 4.28 percent this March, up compared to 3.87 percent a year ago.

  • Housing affordability declined from a year ago in March moving the index down 8.2 percent from 172.3 to 158.2. The median sales price for a single family home sold in March in the US was $227,800 up 6.6 percent from a year ago.
  • Nationally, mortgage rates were up 41 basis point from one year ago (one percentage point equals 100 basis points) while incomes rose 2.8 percent.
  • Regionally, the South had the biggest increase in price at 8.6 percent. The West had an increase of 8.3 percent while the Midwest had a 6.2 percent gain in price. The Northeast had the smallest incline in price of 1.6 percent.
  • Regionally, all four regions saw a decline in affordability from a year ago. The West and the South had the biggest decline of 9.9 percent. The Midwest followed with a decline of 7.9 percent. The Northeast had the smallest decline of 5.2 percent.
  • By region, affordability is down from last month except in the West where there was no change. The Midwest had the biggest decline of 4.5 followed by the Northeast who had a decline of 3.8 percent. The South had the smallest decline in affordability of 0.6 percent.
  • Despite month-to-month changes, the most affordable region is the Midwest where the index is 201.5.  The least affordable region remains the West where the index is 113.4.  For comparison, the index is 157.6 in the South, and 163.0 in the Northeast.
  • Mortgage applications are currently up this week. Rates are higher but still historically low. The home ownership rate is near a 50 year low.  Potential homeowners can strategize on using their tax refund this year or next year to help on the down payment. Some are already thinking of doing so as covered in this blog here.
  • 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.

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