Central Florida county housing markets were more affordable in Q1 2016 than their historically normal levels, according to RealtyTrac’s Q1 2016 Home Affordability Index.
Conversely, 9 percent of U.S. county housing markets were less affordable in Q1 2016, up from 2 percent of markets that exceeded historic home affordability levels a year ago, according to RealtyTrac.
The report analyzed median home prices from publicly recorded sales deed data collected by RealtyTrac and average wage data from the U.S. Bureau of Labor Statistics in 456 U.S. counties with a combined population of 221 million.
The affordability index was based on the percentage of average wages needed to make monthly house payments on a median-priced home with a 30-year fixed rate and a 3 percent down payment, including property taxes and insurance.
In the RealtyTrac report, Central Florida’s counties all were considered affordable housing markets with affordability index scores above 100. They are listed by county, affordability index, median sales price and percent of average wages to buy:
- Volusia; 123; $135,000; 28.6%
- Osceola; 120; $155,000; 34.2%
- Seminole; 119; $179,025; 33%
- Brevard; 118; $142,000; 24.1%
- Lake; 117; $163,250; 35.5%
- Orange; 113; $178,000; 30.8%
Orange County’s median home sales price in first-quarter 2016 was up 117 percent from its most affordable price of $82,000 in first-quarter 2011, and down 48 percent from its least affordable median sales price of $345,000 in third-quarter 2006.
Almost all of Florida’s 34 counties that were analyzed were among the nation’s affordable housing markets, with a first-quarter 2016 affordability index above 100.
Only two of Florida’s 34 counties that were analyzed had a score of just 100: in the Cape Coral-Fort Myers area and Punta Gorda, making them among the state’s counties with the least affordable housing markets, followed by Naples, The Villages and Sarasota, with scores of 102, 103 and 104, respectively.
The counties with the most affordable housing markets in Florida among the 34 counties that were analyzed were in the Fort Walton Beach area, Gainesville, Pensacola, Jacksonville and Tallahassee, with scores of 138, 133, 132, 129 and 125, respectively.
Out of the 456 U.S. counties analyzed in the report, 43 counties (9 percent) had an affordability index below 100 in the first quarter of 2016, meaning buying a home was less affordable than the historically normal level for that county going back to the first quarter of 2005. That was up from 10 counties (2 percent of the 456 counties analyzed) exceeding historically normal home affordability levels in the first quarter of 2015.
At the peak of the housing bubble in second-quarter 2006, 454 of the 456 U.S. counties analyzed (more than 99 percent) were less affordable than their historic norms. In first-quarter 2012, when median home prices bottomed out nationally, only two counties out of the 456 analyzed (less than one-half percent) exceeded their historically normal affordability levels.
“While the vast majority of housing markets are still affordable by their own historic standards, home prices are floating out of reach for average wage earners in a growing number of U.S. housing markets,” said Daren Blomquist, senior vice president at RealtyTrac, in a prepared statement. “The recent drop in interest rates has helped to soften the blow of high-flying price appreciation in some markets, but the affordability equation could change quickly if interest rates trend higher and home prices continue to rise faster than wages.”
Source: Bureau of Labor Statistics