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Still, exploring other cities in which to buy properties yields no panacea: “Affordability declined year over year in all of the 50 markets we track in April,” Fleming noted. “Mortgage rates increased 1.9 percentage points relative to one year ago, which reduces affordability, all else held equal. Higher mortgage rates decrease affordability equally in each market as mortgage rates are generally similar across the country. However, household income growth and nominal house prices vary by market, creating the geographic variance in affordability. Faster nominal house price appreciation can erode, or even eliminate, the boost in affordability from higher household income.”
Nevertheless, the economist produced a list of the top five markets at both extremes of affordability. The top five cities where affordability declined the most year-over-year, in descending order, are:
- Charlotte, N.C. (+62.5%)
- Tampa, Fla. (+59.6%)
- Raleigh, N.C. (+59.6%)
- Orlando, Fla. (+56.2%)
- Phoenix (+56.1%)
Conversely, the top five cities where affordability declined the least are:
- Virginia Beach, Va. (+28.5%)
- Detroit (+29.9)
- Portland, Ore. (+30.7%)
- Boston (+31.4%)
- Louisville, Ky. (+32.5%)
Fleming also provided some states’ highlights from April:
- The five states with the greatest year-over-year increase in the RHPI were: Florida (+64.1), South Carolina (+60.5%), Arizona (+54.1%), Georgia (+52.8), and Connecticut (+51.5%).
- There were no states with a year-over-year decrease in the RHPI.
Some local market highlights:
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