The National Association of REALTORS® reported that home prices continued to rise in the third quarter of 2023. National median prices rose 2.2% year over year to $406,900. Median home prices rose by 1.1% compared to the previous quarter. A total of 182 metro areas had year-over-year price increases in the third quarter of 2023.
This quarter, monthly mortgage payments on a single-family home increased 19.3% to $2,192 compared to $1,838 from a year ago. Qualifying median family incomes rose to $105,216 compared to the second quarter of 2023, which was $98,405 (and $88,242 a year ago). The effective 30-year fixed mortgage rate increased to 7.12% in the third quarter of 2023 compared to 5.65% one year ago. Median family incomes rose to $98,287 in the third quarter of 2023 compared to $93,776 a year ago.
Knowing the mortgage rates and the qualifying incomes for down payments will help potential homeowners figure out what metro areas are affordable for them.
Here is a look at the metro areas with the strongest price growth and the yearly change in median existing single-family home prices among the top five highest and lowest growth metro areas of the third quarter of 2023.
Top five single-family metro areas with the highest home price appreciation
The metro areas in the U.S. with the highest home price appreciation in Q3 2023 for single-family homes were Fond du Lac, WI (18.9%); Hickory-Lenoir-Morganton, NC (17.1%); Oshkosh-Neenah, WI (15.2%); Green Bay, WI (14.8%), and Reading, PA (14.7%).
Bottom five single-family metro areas with the slowest home price appreciation in Q3 2023
The metro areas in the U.S. with the lowest home price appreciation in Q3 2023 for single-family homes were Cape Coral-Fort Myers, FL (-3.6%); Shreveport-Bossier City, LA (-4.6%); Jackson, MS (-4.8%); Urban Honolulu, HI (-5.8%); and Austin-Round Rock, TX (-10.3%).
Most expensive metro areas for single-family homes in Q3 2023
The most expensive metro areas for single-family homes in the U.S. during Q3 2023 were San Jose-Sunnyvale-Santa Clara, CA ($1,850,000); Anaheim-Santa Ana-Irvine, CA ($1,305,000); San Francisco-Oakland-Hayward, CA ($1,300,000); Urban Honolulu, HI ($1,062,000), and San Diego-Carlsbad, CA ($979,000).
Least expensive metro areas for single-family homes in Q3 2023
The least expensive metro areas for single-family homes in the U.S. during Q3 2023 were Peoria, IL ($158,000); Elmira, NY ($157,000); Cumberland, MD-WV ($152,000); Youngstown-Warren-Boardman, OH-PA ($151,000); and Decatur, IL ($128,000).
Qualifying Income Based on Sales Price of Existing Single-family Homes for Metropolitan Areas by Region
At the 5% down-payment threshold, the qualifying income amount for the third quarter of 2023 was $124,943. At the 10% down-payment mark, the qualifying income was $118,367. With a 20% down payment, the income required to qualify for a mortgage was $105,216. The West led all regions with the highest qualifying income, while the Midwest had the lowest income for 5%, 10%, and 20% down payments on single-family homes.