The Joint Center for Housing Studies at Harvard recently released this report with a lot of interesting data about the overall affordability of housing in the United States. Below is a quick summary of what they found, but we strongly encourage you to click through to the original interactive maps–they are fascinating!

Residential Land Prices in Many Areas Have Risen Sharply Since 2012

This chart shows data by county for how much the price of land changed, percentage-wise, between 2012 and 2017. While some areas of the country have seen a decline (light blue), California’s affordability problem stands out sharply.

Notes: Median land prices per acre are for land occupied by single-family homes. Dollar values are nominal.
Source: Harvard Joint Center for Housing Studies tabulations of Federal Housing Finance Agency (FHFA), The Price of Residential Land for Counties, ZIP Codes, and Census Tracts in the United States.

Home Price-to-Income Ratios

This chart shows how median home prices in different areas compared to median income, starting in 1980 all the way up to 2017. Starting in 2012, the map gets more colorful as home prices in some counties rise to as much as four to eight times what people are earning.

Note: Home prices are the median sale price of existing homes and incomes are the median household income within markets.
Source: JCHS tabulations of National Association of Realtors, Metropolitan Median Area Prices, and Moody’s Analytics Forecasts.

Home Ownership Affordability Varies Across the Country

This chart shows the percentage of recently sold homes in the listed counties that are affordable for households with a median income for that location.  It’s plain to see that owning a home in the U.S. remains a more financially viable option than renting.

Notes: Median incomes are estimated at the core-based statistical area (CBSA) level. Recently sold homes are defined as homes with owners that moved within the 12 months prior to the survey date. Monthly payments assume a 3.5% downpayment and property taxes of 1.15%, property insurance of 0.35%, and mortgage insurance of 0.85%. Affordable payments are defined as requiring less than 31% of monthly household income. Only CBSAs with at least 30 home sales in the past year are shown.
Source: Harvard Joint Center for Housing Studies tabulations of US Census Bureau, 2017 American Community Survey 1-Year Estimates, and Freddie Mac, PMMS.

Share of Homes Affordable to Potential Buyers Varies Widely

This chart defines “affordable” as a house payment that is less than 31 percent of a household’s monthly income. Six different categories are represented by three income levels (low, median and high) and owning vs. renting. As the title indicates, whether potential buyers in the different markets can afford the available homes varies widely for different parts of the country.

Notes: Lower- (higher-) income households are at the 25th (75th) percentile of income in their area. Only homes where the owner moved in within the previous 12 months are included (a proxy for recently-sold homes). Monthly payments assume a 3.5% down payment with property taxes of 1.15%, property insurance of 0.35%, and mortgage insurance of 0.85%. “Affordable” payments require less than 31 percent of monthly household income. CBSAs with fewer than 30 observations of home sales in the past year are excluded.
Source: JCHS tabulations of US Census Bureau, 2016 American Community Survey 1-Year Estimates; Freddie Mac PMMS 30-Year FRM Interest Rates.

Cost Burdens Rise With Age in Many Metros

This chart shows what percentage of the population aged fifty and above are considered to be “cost-burdened” by their housing expenses.  “Severely cost-burdened” is defined as requiring more than 50 percent of monthly household income to cover housing.

Notes: Moderately (severely) cost-burdened households pay 30–50% (more than 50%) of income for housing. Households with zero or negative income are assumed to have severe burdens, while households paying no cash rent are assumed to be without burdens.
Source: JCHS tabulations of US Census Bureau, 2006–2016 American Community Survey 1-Year Estimates using the Missouri Data Center MABLE/geocorr14.

Who Can Afford the Median-Priced Home in Their Metro?

The two versions shown of this chart reveal the percentage of available single-family homes in different metro areas that are affordable for 1) all median wage earners, and 2) median wage earners who rent their homes.

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