Affordability Expectations Among Home Buyers Improved From Q2 to Q3
Affordability Expectations Improve as the Typical Buyer Changes
According to the latest Housing Trends Report (HTR)—a research product created by the National Association of Home Builders Economic Team—in 22Q3, prospective home buyers were more likely to have higher levels of income and education than earlier in the year. This information helps explain why affordability expectations, according to the HTR, have improved.
In Q3, 69% of buyers could only afford a minority of homes for sale in their markets, a much lower share than in Q1 when it was 81%, or Q2 when it was 77%. On the other hand, the share able to afford at least half the homes rose to 31% up from Q1 at 19% and Q2 at 23%.
The HTR reports that expectations between Q2 and Q3 of 2022 improved in all of the US. In the Northeast, the share of buyers only able to afford a minority of homes dropped from 73% in Q2 to 66% in Q3. In the Midwest it went from 84% to 83%. In the South, it went from 82% to 77%. In the West, it went from 70% in Q2 down to 58% in Q3.
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