Sixty-five percent of new and existing homes sold in the first quarter of 2016 were affordable to families earning the United States median income of $65,700, up from 63.3 percent in the fourth quarter, according to the National Association of Home Builders Housing Opportunity Index.
The increase was due in part to a modest reduction in mortgage interest rates and favorable home prices, said NAHB Chief Economist Robert Dietz in a statement.
"This is the second consecutive quarter that we've seen a nationwide improvement in affordability due to favorable home prices and mortgage rates," he said. "These factors, along with rising employment, a growing economy and pent-up demand will provide a boost for home sales in the second half of 2016."
The national median home price dropped to $223,000 in the first quarter, compared with $226,000 in the fourth quarter. Average mortgage rates decreased from 4.09 percent to 4.05 percent during the same time period.
The nation’s most affordable major housing market was Youngstown-Warren-Boardman, Ohio, where 93.1 percent of new and existing homes sold in the first quarter were affordable to families earning the area’s median income of $53,900. The least affordable major housing market, where only 10.4 percent of homes were affordable to families earning the area’s median income of $96,800, was San Francisco-Redwood City-South San Francisco, Calif.
