Home affordability has dropped to its lowest level in 10 years, prompting housing experts to call it one of the most significant signs we’ve seen yet of a cooling marketplace.
According to recently released statistics from Attom Data Solutions, U.S. home prices have fallen to the lowest level of affordability since the third quarter of 2008 thanks in large part to home prices consistently rising as wages in many cities across the country remain stagnant.
Locally, Cook County’s affordability index has dropped 10 percent from last year, while Los Angeles and New York have seen a 12 and 8 percent decline respectively.
From a nationwide perspective, the median sales price from October through December has jumped 9 percent to $241,250 while the average weekly wage has only jumped 3 percent from this time last year.
In addition, home builders are also seeing construction and supply costs rising, ultimately making building a home more expensive, as well as new construction home prices more expensive.