The National Association of REALTORS® reported that home prices continued to rise in the third quarter of 2022. Forty-six percent of the metro markets posted double-digit annual price appreciation this quarter compared to 80% in the previous quarter. National median prices rose 8.6% year over year to $398,500. While median home prices rose by 8.6%, year-over-year price appreciation decelerated compared to the previous quarter's 14.2%.
This quarter's monthly mortgage payments on a single-family home increased to $1,840 compared to $1,226 from a year ago. Qualifying median family incomes rose to $88,331 compared to the second quarter of 2022, which was $88,200, and $58,826 a year ago. The effective 30-year fixed mortgage rate increased to 5.65% in the third quarter of 2022 compared to 2.92% one year ago.
Knowing the mortgage rates and the qualifying incomes for down payments will help potential homeowners figure out what metro areas are affordable.
Here is a look at the metro areas with the strongest price growth in the third quarter of 2022, as well as 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 2022.
The top five single-family metro areas with the highest home price appreciation were North Port-Sarasota-Bradenton, FL (23.8%); Lakeland-Winter Haven, FL (21.2%); Myrtle Beach-Conway-North Myrtle Beach, SC (21.1%); Panama City, FL (20.5%); Deltona-Daytona Beach-Ormond Beach, FL (19.6%).
The bottom five single-family metro areas with the slowest home price appreciation were Boise City-Nampa, ID (0.6%); Binghamton, NY (-1.1%); San Francisco-Oakland-Hayward, CA (-3.7%); Bismarck, ND (-4.1%) and Cumberland, MD-WV (-4.5%).
The most expensive metro areas for the third quarter of 2022 were San Jose-Sunnyvale-Santa Clara, CA ($1,688,000); San Francisco-Oakland-Hayward, CA ($1,300,000); Anaheim-Santa Ana-Irvine, CA ($1,200,000), Urban Honolulu, HI ($1,127,000); and San Diego-Carlsbad, CA ($900,000).
The least expensive metro areas for the third quarter of 2022 were Elmira, NY ($157,000); Peoria, IL ($148,000); Youngstown-Warren-Boardman, OH-PA ($148,000); Cumberland, MD-WV ($137,000), and Decatur, IL ($123,000).
Qualifying Income Based on Sales Price of Existing Single-family Homes for Metropolitan Areas by Region
Nationally, at the 5% down payment threshold, the qualifying income for the third quarter of 2022 was $104,893. At the 10% down-payment mark, the qualifying income was $99,372, and with a 20% down-payment, the income required to qualify for a mortgage was $88,331. 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.