--- title: Housing Affordability Just Hit a Record Low — but That Should Change Soon description: Housing affordability just reached a new low, but lower mortgage rates and an increase in inventory should have buyers hopeful. authors: - name: Sarah Hansen role: Senior Writer url: https://money.com/author/sarah-hansen/ bio: Sarah Hansen is a senior writer at Money covering all things personal finance. Previously, she covered economic policy and capital markets on the breaking news desk at Forbes. education: Northwestern University, New York University at_money_since: 2021 articles: 347 covers: - Housing - Banking - Business - Career Advice - Credit - Credit Cards - Economy and Politics - Education - Health and Wellness - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Professional Services - Retirement - Shopping - Taxes social: - https://www.linkedin.com/in/sarah-m-hansen/ former_staff: true editors: - name: Brad Tuttle role: Senior Editor url: https://money.com/author/brad-tuttle/ bio: Brad Tuttle is a former senior editor at Money with over 10 years’ experience covering a vast number of personal finance topics, including careers, cars, travel, budgeting, investing, insurance, credit cards, consumer psychology, real estate, banking, and shopping and deals. education: Columbia University School of Journalism, MS at_money_since: 2014 articles: 366 covers: - Housing - Banking - Business - Career Advice - Credit - Credit Cards - Economy and Politics - Education - Health and Wellness - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Pets - Professional Services - Retirement - Shopping - Taxes - Technology social: - https://twitter.com/bradrtuttle - https://linkedin.com/in/brad-tuttle-834b225 former_staff: true published: '2023-02-10T17:49:46.000Z' modified: '2024-01-10T14:35:00.000Z' section: Housing tags: - News word_count: 359 canonical: https://money.com/housing-affordability-low-mortgage-rates-falling/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Aerial view of Suburban Neighbourhood](https://img.money.com/2023/02/News-Housing-Affordability-Low.jpg) Affordability is one of the biggest challenges homebuyers face today. By one measure, housing affordability in the U.S. just hit the lowest point in at least a decade. Aspiring homebuyers have had to deal with surging house prices throughout the pandemic, combined with a steep rise in borrowing costs last year. But as [mortgage rates](https://money.com/current-mortgage-rates/) fall, there may finally be some good news for hopeful buyers. ## What the data shows The National Association of Home Builders (NAHB) and Wells Fargo Housing Opportunity Index tracks the portion of homes sold in a given area that are considered “affordable” for a family earning the median income. (NAHB defines an affordable home as one that does not require a family to spend more than 28% of its gross income on housing each month.) In the last quarter of 2022 (October through December), 38.1% of homes sold in the U.S. were affordable for families earning $90,000, the median national household income. That’s the lowest level since the NAHB began tracking this data in 2012. Between July and September, for example, 42.2% of homes sold were considered affordable according to the NAHB’s index. ## What the experts say Even though the share of affordable homes sold dropped at the end of last year, homebuyers may soon catch a break. “With mortgage rates anticipated to continue to trend lower later this year, affordability conditions are expected to improve, and this will increase demand and bring more buyers back into the market,” NAHB Chief Economist Robert Dietz said in a [news release](https://www.nahb.org/news-and-economics/press-releases/2023/02/housing-affordability-hits-record-low-but-turning-point-lies-ahead). ## Keep in mind Real estate prices vary widely at the local level. NAHB data shows that the least affordable major housing markets in the country are all located in California: - Los Angeles - Anaheim - San Diego - San Francisco - San Jose The most affordable major housing markets, on the other hand, are concentrated in the Rust Belt: - Indianapolis, Indiana - Rochester, New York - Pittsburgh, Pennsylvania - Toledo, Ohio - Dayton, Ohio ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/housing-affordability-low-mortgage-rates-falling/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Housing", "item": "https://money.com/housing/" }, { "@type": "ListItem", "position": 3, "name": "Home Prices", "item": "https://money.com/home-prices/" }, { "@type": "ListItem", "position": 4, "name": "Housing Affordability Just Hit a Record Low — but That Should Change Soon" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/housing-affordability-low-mortgage-rates-falling/#webpage", "url": "https://money.com/housing-affordability-low-mortgage-rates-falling/", "name": "Housing Affordability Just Hit a Record Low — but That Should Change Soon", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2023-02-10T17:49:46.000Z", "mainEntity": { "@id": "https://money.com/housing-affordability-low-mortgage-rates-falling/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/housing-affordability-low-mortgage-rates-falling/#breadcrumb" }, "dateModified": "2024-01-10T14:35:00.000Z" }, { "@type": "NewsArticle", "headline": "Housing Affordability Just Hit a Record Low — but That Should Change Soon", "articleSection": "Housing", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2023/02/News-Housing-Affordability-Low.jpg", "width": 2880, "height": 1920, "caption": "News-Housing-Affordability-Low" } ], "author": [ { "@type": "Person", "name": "Sarah Hansen", "url": "https://money.com/author/sarah-hansen/", "@id": "https://money.com/author/sarah-hansen/#author", "description": "Sarah Hansen is a senior writer at Money covering all things personal finance. 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