Homeownership Increasingly Difficult for Average Americans #realestate #asset

Source:  Reuters

Home prices are rising faster than wages in most of the United States, making homeownership increasingly difficult for average Americans in some of the most populous areas of the country, according to a report released by RealtyTrac.

Making Sense of the Story:

- Home prices in 9 percent of the U.S. housing market are now less affordable than their historic norms.

- The report found that home price growth exceeded wage growth in nearly two thirds of the nation's housing markets in 2016, with urban centers like San Francisco and New York City among the least affordable.

- The report analyzed median home prices derived from publicly recorded sales deed data and average wage data from the U.S. Bureau of Labor Statistics in 456 U.S. counties with a combined population of 221 million.

- Out of the 456 counties analyzed in the report, 43 counties (9 percent) had an affordability index below 100 in the first quarter of 2016, meaning buying a home was less affordable than the historically normal level for that county going back to the first quarter of 2005.

- Daren Blomquist, senior vice president at RealtyTrac, commented, "While the vast majority of housing markets are still affordable by their own historic standards, home prices are floating out of reach for average wage earners in a growing number of U.S. housing markets."

- In Q1 2012, when median home prices bottomed out nationally, only two counties out of the 456 analyzed (less than one-half percent) exceeded their historically normal affordability levels.

- Annual change in median home prices in Q1 2016 outpaced annual change in average weekly wages in Q3 2015 in 276 of the 456 counties analyzed for the report (61 percent).

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