【World Property Journal】U.S. Housing Affordability Hits 18-Month Low on Lack of Supply, Higher Prices

According to the latest National Association of Home Builders / Wells Fargo Housing Opportunity Index, despite low interest rates, a supply shortage coupled with rising home prices contributed to a decline in housing affordability in the second quarter of 2020.

In all, 59.6 percent of new and existing homes sold between the beginning of April and end of June were affordable to families earning an adjusted U.S. median income of $72,900. This is down from the 61.3 percent of homes sold in the first quarter of 2020 that were affordable to median-income earners and the lowest reading since the fourth quarter of 2018.

The Department of Housing and Urban Development's original estimates of median family income for 2020 were developed prior to the COVID-19 pandemic. To account for the pandemic's effects, the HUD estimates were reduced consistent with NAHB's economic forecast for 2020. As a result, the 2020 national median income estimates used in the HOI calculations ($72,900) are 7.1 percent lower than the initial national 2020 estimates ($78,500) from HUD.
 

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