Housing Affordability Continued its Decline in Q3 2020

According to the National Association of Home Builders (NAHB) / Wells Fargo Housing Opportunity Index (HOI) in Q3 of 2020, housing affordability continued to decline in spite of record low mortgage rates, which were offset by rising home prices and lack of available homes for sale. According to the HOI 58.3% of new and existing homes sold between the beginning of July and end of September were affordable to families earning an adjusted U.S. median income of $72,900. This is down from the 59.6% of homes sold in the second quarter of 2020 that were affordable to median-income earners and the lowest reading since the fourth quarter of 2018. The HOI also showed that that the national median home price jumped to an all-time high of $313,000 in Q3, surpassing the previous record-high of $300,000 set in Q2.