Housing affordability continues to be a struggle for the real estate industry.
According to the NAHB/Wells Fargo Housing Opportunity Index, 43.4% of existing homes sold from the beginning of April through the end of June 2021 were not affordable to families who earned the median income in the country, which is $79,900. While 56.6% of existing homes sold in the second quarter were affordable, that is down 6.5% from 63.1% in the first quarter of 2021. The median home price skyrocketed to over $350,000 in the second quarter, an increase of $30,000 from the first quarter of 2021, making it the largest jump since the HOI was established in the first quarter of 2012. Housing affordability is now at its lowest level in nearly a decade.
However, for those of us in the commonwealth, three of the top five most affordable housing markets (with a population of at least 500,000) are right here in Pennsylvania. Pittsburgh was named the most affordable housing market, with 90.6% of all new and existing homes affordable to a family earning the area’s median income of $84,800. The median home price in the area was $165,000. The Scranton-Wilkes-Barre-Hazleton area was named the fourth most affordable market, with 89.9% of homes deemed affordable to their median income, which is $70,600. The median price of homes sold in the past quarter was $135,000 in the northeast corner of the state.
The Harrisburg-Carlisle region rounded out the top five. There, the median home price sold was $182,000 and the housing affordability based on the median income of $84,900 was 89.6%.
“Runaway construction cost growth, such as ongoing elevated prices for oriented strand board that has skyrocketed by nearly 500% since January 2020, continue to put upward pressure on home prices,” said NAHB Chairman Chuck Fowke.