If you’re looking for the most affordable housing market in the United States, then you’ll be heading to Ogden-Clearfield Utah. The region holds the title for the beginning of 2013, according to the National Association of Home Builders.
Some 93.4 percent of all homes sold there in the first quarter were affordable to families earning the median income of $70,800, according to NAHB’s Housing Opportunity Index.
“HOI results for the beginning of 2013 are little changed from what they were at the end of 2012, with Ogden-Clearfield, Utah holding onto the title of the nation’s most affordable major housing market and San Francisco-San Mateo-Redwood City, California, retaining its position as the least affordable major market,” noted NAHB Chief Economist David Crowe. “The bottom line is that, for consumers who can qualify for a mortgage at today’s attractive rates, the majority of homes being sold remain within their grasp in markets nationwide.”
Rounding out the top five affordable markets are:
- Indianapolis/Carmel, Indiana
- Lakeland-Winter Haven, Florida
- Youngstown-Warren-Boardman, Ohio-Pennsylvania
- Syracuse and Albany/Schenectady/Troy (both in New York) tied for fifth.
Although the market is affordable in Indianapolis, the outlook statewide echoes what is occurring in many markets around the country.
“Low interest rates have lured consumers to the marketplace and confidence has kept them there,” said Kevin Kirkpatrick, 2013 President of the Indiana Association of REALTORS® and co-owner of Prudential Indiana Realty Group. “But, low inventory has created a competitive environment over limited choices. While this has put more homeowners in a better equity position, it also threatened sales volume down the road. Luckily, April brought an increase in new listings,” he said.
Meanwhile, number four on the most-affordable list, Youngstown, Ohio, last month was named one of the top five places for boomers to live. The boomer web site lifegoesstrong.com said “the region offers mid-lifers the best combination of basics essential to a good place to live. It scores above average on all of them and has the lowest average home price. In short, Youngstown leaves nothing to be desired when it comes to the basics.”
The standings, which are based on 10 factors including cost of living, violent crime rate and closeness to hospitals, reveals that Boomers’ decisions are more based on money rather than proximity to amenities.
“This ranking belies the mid-lifers stereotype of spendthrift hedonists,” said J. Walker Smith, Executive Chairman of The Futures Company, commenting on the research on the web site. Prudence tops the list; high living and highbrow fill out the bottom. In fact, this ranking reveals three underlying things that matter most to us about place: Pocketbook first. Peace of mind next. And only then, proximity to indulgences and amenities.”
In a national snapshot, families earning the U.S. median income of $64,400 could afford 73.7 percent of homes sold between January and March. This is a decrease from 74.9 percent in the last quarter of 2012.
Meanwhile, on the opposite end of the spectrum, the most expensive market of the San Francisco/San Mateo/Redwood City region of Northern California saw just 28.9 percent of the families in this affluent area who could afford a home with a median income of $102,000.
What’s more, San Francisco hit an unsavory milestone as the median price topped $1 million, according to the San Francisco Business Times. The last time it skyrocketed that high was in 2007. The median price a year ago was $760,000.
Just 28 percent of homes sold were affordable to those earning the median income of $102,000. For those setting their sights on a San Francisco condo, the median price was $850,000 in April.
“Shrinking inventory combined with low interest rates and motivated buyers has resulted in historically high sales prices,” said Christine Dwiggins, president of the San Francisco Association of Realtors.
The other markets that follow the San Francisco Bay Area on the least-affordable list are:
- New York/White Plains/Wayne, New York/New Jersey.
- Santa Ana/Anaheim/Irvine, California
- Los Angeles/Long Beach/Glendale, California
- San Jose/Sunnyvale/Santa Clara, California
Meanwhile, the overall national outlook for the increase in the number of home sales continues to be encouraging.
“The housing market continues to squeak out gains from already very positive conditions,” said Lawrence Yun, NAR chief economist. “Pending contracts so far this year easily correspond to higher closed home sales in 2013. Total existing-home sales are expected to rise just over 7 percent to about 5 million this year.”
Home prices are expected to continue on this trajectory as well.
“Because of inventory shortages, higher home sales will push up home values to the highest level in five years,” Yun said. The national median existing-home price should increase close to 8 percent and exceed $190,000 in 2013.”
Michele Dawson specializes in real estate and has been writing for 20 years. She has written for the Sacramento Business Journal, California Builder Magazine, and other publications.