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Homes Haven’t Been This Unaffordable in Almost 9 Years

The U.S. median home price of $253,000 in the second quarter of 2017 was at the least affordable level since Q3 2008 – a nearly nine-year low in affordability.

By Toby Tobin

IRVINE, Calif. – June 30, 2017 – ATTOM Data Solutions' Q2 2017 U.S. Home Affordability Index finds that the U.S. median home price of $253,000 in the second quarter of 2017 was at the least affordable level since Q3 2008 – a nearly nine-year low in affordability.

The report also shows that 210 of 464 U.S. counties analyzed for the index (45 percent) were less affordable than their historic affordability norms in the second quarter of 2017 – the highest share of markets less affordable than their historic norms since Q4 2009.

"While home price appreciation in the second quarter accelerated to the fastest pace in more than three years, wage growth turned negative, posting the biggest year-over-year decrease in five years in Q4 2016 – the most recent average weekly wage data available," says Daren Blomquist, senior vice president at ATTOM Data Solutions.

"That combination of accelerating home price growth and slowing wage growth, along with mortgage interest rates that are up nearly 50 basis points from a year ago, eroded home affordability nationwide to the lowest level in nearly nine years, and pushed the highest share of markets beyond the threshold of normal affordability in nearly eight years."

The average weekly wage nationwide was $1,067 in Q4 2016 – the most recent weekly wage data available from the Bureau of Labor Statistics – down 1.4 percent from a year ago, and the biggest annual decrease since Q4 2011.

Since bottoming out nationwide in Q1 2012, median home prices nationwide have increased 69 percent while average weekly wages have increased 9 percent during the same time period.

© 2017 Florida Realtors. All rights reserved. Reprinted with permission.

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Don "Toby" Tobin is a licensed real estate professional affiliated with Grand Living Realty. Toby is a member of the Flagler County Association of Realtors®, the Florida Association of Realtors, Enterprise Flagler, Flagler Home Builders Association, and the National Association of Realtors.

GoToby.com proivdes real estate news, commentary, and analysis for Palm Coast and Flagler Country Florida, as well as Realtor® referrals and consultation to buyers, sellers, and developers.