Places where houses are affordable to residents in the United States are rapidly declining as home prices soar and mortgage rates remain elevated.
That is according to an analysis conducted by real estate data company ATTOM, which found that homeowners in 80% of the country's 589 larger counties in the US were spending more than 28% of their wages on housing costs, which includes monthly mortgage payments, property taxes, and insurance.
In addition, the analysis found that the household earning the typical annual income of $72,358 paid about $2,114 a month in housing costs. That means they consumed 35.1% of their wage on housing costs in the second quarter of this year, marking the highest share recorded since 2007. It is also 3% higher than last year.
In a third of the larger counties in the country, the typical household earning average wage was found to have spent at least 43% of their wages on housing costs alone.
"The latest affordability data presents a clear challenge for home buyers. While home prices are increasing and mortgage rates remain relatively high, these factors are making homes less affordable," Rob Barber, CEO of ATTOM, said in the report.
"It's common for these trends to intensify during the Spring buying season when buyer demand increases. However, the trends this year are particularly challenging for house hunters, more so than at any point since the housing market boom began in 2012," he continued.
ATTOM's analysis focused on counties with a population of at least 100,000 and with at least 50 single-family homes and condo sales in Q2 2024.
Where Are Homes Unaffordable?
The counties where the average local wages consumed by homeownership costs exceeded 28% during the second quarter of 2024 included Los Angeles County, California; Cook County, Illinois; Maricopa County, Arizona; San Diego County, California; and Orange County, California.
In contrast, the most affordable counties during the second quarter of 2024 were Harris County, Texas; Wayne County, Michigan; Philadelphia County, Pennsylvania; Cuyahoga County, Ohio; and Allegheny County, Pennsylvania.
As of June, the national median home sale price rose to $397,954, up from $383,000 year-over-year, according to Redfin.
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