Triad housing market among most affordable for top-100 US metros | Local

RealtyHop released its latest monthly report Tuesday. 

The group’s measuring stick is share of household income required for homeownership, with the metro listed at No. 1 being the least affordable residential housing market.

The five-county Winston-Salem area was ranked 75th, up from 79th in the previous report.

The share of household income required was determined to be 30.54% based on the following three primary factors: average annual household income of $53,447; average home price at $249,900; and $1,360 in estimated monthly mortgage and tax expenses.

Winston-Salem was bracketed by Milwaukee at 74th and Baltimore at 76th.

By comparison, the three-county Greensboro-High Point metro was ranked 80th, up from 82nd in the previous report.

The share of household income required was determined to be 29.21% based on the following three primary factors: average annual household income of $57,202; average home price at $252,500; and $1,392 in estimated monthly mortgage and tax expenses.

Greensboro-High Point was bracketed by Tulsa, Okla., at 79th and St. Paul, Minn. at 81st.

RealtyHop said that for the July report, it updated the mortgage interest rate for payment calculation from 4.5% to 5.5% “to reflect the housing market’s current state.”

“Despite certain housing markets showing signs of cooling off, homes in major U.S. cities are still generally unaffordable. Of the 100 most populous cities, the average families in these cities will have to spend 28% or more of their annual income on owning costs.”

Atop the RealtyHop list as least affordable metro is Miami at nearly 86% of monthly household income based on average household income of $44,581 and average home price of $600,000.

By contrast, the most affordable metro is Fort Wayne, Ind., at 17.2% of monthly household based on average household income of $57,533 and average home price of $155,000.

In June, Attom Data Solutions determined that the sharp climb in existing home prices during the COVID-19 pandemic has the Triad housing market at its least affordable level for potential buyers in at least 17 years.

Attom listed Alamance, Davidson, Forsyth, Guilford and Randolph counties in the least affordable category.

Attom’s affordability index is based on the percentage of average wages needed to pay for major expenses on a median-priced home with a 30-year fixed rate mortgage and a 20% down payment. Median is defined as the middle value in a list of numbers.

Those expenses include property taxes, home insurance, mortgage payments and mortgage insurance.

The key element in determining affordability is whether a household had to spend at least 28% of their monthly income on mortgage payments, property taxes and insurance.

For the purposes of the index, a 100 score represents the equilibrium point of affordability. A score below 100 signifies less affordable, while above 100 signals more affordable.

For the second quarter, Forsyth was rated with a 69 score, compared with a 94 score a year ago.

In Forsyth, affordability was measured on a $250,000 median sale price based on 1,714 single-family home purchases. That price was up 21% from a year ago.

Attom calculated that a new Forsyth homeowner would need an annual income of $53,518 to afford the yearly expenses associated with a $250,000 home, and that it would take 25.2% of the first-year annual wages to afford a 20% down payment.

Historically since 2000, a new Forsyth homeowner has needed to dedicate an average of 17.4% of the first-year annual wage toward the 20% down payment.

Meanwhile, Guilford was rated with a 72 score, compared with 98 a year ago.

In Guilford, affordability was measured on a $235,000 median sale price based on 1,719 single-family home purchases. That price was up 19% from a year ago.

Attom calculated that a new Guilford homeowner would need an annual income of $49,996 to afford the yearly expenses associated with a $235,000 home, and that it would take 25.3% of the first-year annual wages to afford a 20% down payment.

Historically since 2000, a new Guilford homeowner has needed to dedicate 18.2% of the first-year annual wage toward the 20% down payment.

Davidson was rated with a 66 score, compared with 91 a year ago.

In Davidson, affordability was measured on a $202,140 median sale price based on 502 single-family home purchases. That price was up 23% from a year ago.

Attom calculated that a new Davidson homeowner would need an annual income of $41,482 to afford the yearly expenses associated with a $202,140 home, and that it would take 24.8% of the first-year annual wages to afford a 20% down payment.

Historically since 2000, a new Davidson homeowner has needed to dedicate 16.4% of the first-year annual wage toward the 20% down payment.