Home affordability at a national level in the US is down from one year ago and is struggling to keep pace with the increase of home prices, according to new research result.
The analysis from the National Association of Realtor shows that housing affordability is down from one year ago in June as the median price for a single family home in the US is up from one year ago.
Regionally, the West had the biggest increase in price at 10% while the Northeast experienced the slow price growth at 4.4%. The Midwest and the South both areas contributed solid price of 7.2%.
Countrywide, affordability is down from 155.2 in June 2014 to 153.1 in June 2015 and down month on month in all regions. The Midwest had the biggest drop of 4.8% while the West fell only 3.5%.
One year ago from, affordability is down in all regions except for the Northeast which had an increase of 1.1%. The West saw the biggest decline in affordability at 3.6% and the Midwest had the minimum decline of 0.7%.
Regardless of month to month changes, the most affordable region is the Midwest where the index is 191.1. The index is 161.4 in the South, 150.7 in the Northeast, and 113.9 in the West.
With rates on the rise possible home buyers may try to hurry their search and purchasing. Lending options with low down payments are now more generally available. Mortgage applications are at present up but demand may level off if prices and rates continue to increase, the report explains.
It also points out that new home building has favored the multifamily list stock while single family homes have been lagging in manufacture. An increase in single family building will help ease the inventory shortage issue and slow down price growth, it suggests.
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