According to the National Association of Realtors' most recent quarterly report, home prices rose in the vast majority of metro areas in the third quarter of 2022, pushing up the median income required to buy a home in the U.S. as purchasers battled mortgage rates that were close to 7%.
Of the 185 metro areas tracked, 46% registered double-digit price increases, down from 80% in the second quarter of this year.
"The median income needed to buy a typical home has risen to $88,300 – that's almost $40,000 more than it was prior to the start of the pandemic, back in 2019," said NAR Chief Economist Lawrence Yun.
The national median single-family existing-home price climbed 8.6% from a year ago to $398,500.
Housing affordability declined in the third quarter of 2022 as a result of persistently high home prices and rising mortgage rates. With a 20% down payment, the typical existing single-family home's monthly mortgage payment was $1,840.
The average starting home's monthly mortgage payment increased to $1,808 for a $338,700 home with a 10% down payment loan.
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In 59 areas, up from 53 in the previous quarter, a family needed a qualifying income of at least $100,000 to afford a mortgage with a 10% down payment. Meanwhile, a family needed a qualifying income of under $50,000 in 17 cities, down from 23 the previous quarter, in order to afford a home.
Where are people moving? Among the major U.S. regions in the third quarter, it seems most moving Americans relocated to the South, as 44% of all single-family home sales occurred in that area. Consequently, the South registered the highest year-over-year price appreciation, coming in at 11.9% in the third quarter.
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