Housing continues to become less affordable

It feels strange to write about housing affordability during a pandemic with high unemployment.  Even though mortgage rates are down the cost of housing is outpacing wage growth.

According to the National Association of Realtors affordability has declines which is a kind of backward way of saying the housing is less affordable:

“Affordability is down in two of the four regions from last month. The South had a gain of 1.8% followed by the Midwest with an incline of 2.3%. The Northeast had a decline of 1.1% followed by the West with a dip of 2.3%.”

Housing is more affordable in the Midwest than in other parts of the country but went up 2.3% from a year ago. . . which means it is more unaffordable than it was a year ago.

chart of housing costs in US
Housing costs as a percentage of income *

*the chart is a screen print from the National Association of Realtors web site.

 

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