Median Priced Existing Homes Less Affordable Than New Homes in Second Quarter

2024-08-22T10:21:16-05:00

NAHB’s Cost of Housing Index (CHI) highlights the burden that housing costs represent for middle and low-income families. In the second quarter of 2024, the CHI found that a family earning the nation’s median income of $97,800 must spend 38% of its income to cover the mortgage payment on a median-priced new single-family home. Because a typical existing home in the second quarter was more expensive ($422,100) than a typical newly built home ($412,300), the CHI for existing homes was higher, at 39%.  Low-income families, defined as those earning only 50% of median income, would have to spend 77% of their earnings to pay for a new home and 79% for an existing one. The latest results reveal that affordability has worsened for existing homes. A typical family needed 39% of its income to pay for a median-priced existing home in the second quarter, up from 36% in the first quarter. A low-income family needed 79% of its income vs. 71% in the previous quarter. In contrast, the CHI and low-income CHI for new homes remained unchanged between the first and second quarters of 2024, at 38% and 77%, respectively. Additionally, CHI is produced for existing homes in 176 metropolitan areas, breaking down the percentage of a family’s income needed to make a mortgage payment in each area based on the local median existing home price and median income. Percentages are also calculated for low-income families in these markets. In 14 out of 176 markets in the second quarter, the typical family is severely cost-burdened (must pay more than 50% of their income on a median-priced existing home).  In 89 other markets, such families are cost-burdened (need to pay between 31% and 50%). There are 73 markets where the CHI is 30% of earnings or lower. The Top Five Severely Cost-Burdened Markets San Jose-Sunnyvale-Santa Clara, Calif. was the most severely cost-burdened market on the CHI during the second quarter, where 94% of a typical family’s income is needed to make a mortgage payment on an existing home. This was followed by: • San Francisco-Oakland-Berkeley, Calif. (79%)• San Diego-Chula Vista-Carlsbad, Calif. (76%)• Urban Honolulu, Hawaii (76%)• Naples-Marco Island, Fla. (74%) Low-income families would have to pay between 147% and 188% of their income in all five of the above markets to cover a mortgage. The Top Five Least Cost-Burdened Markets By contrast, Decatur, Ill., was the least cost-burdened market on the CHI, where families needed to spend just 15% of their income to pay for a mortgage on an existing home. Rounding out the least burdened markets are: • Cumberland, Md.-W.Va. (17%)• Springfield, Ill. (18%)• Elmira, N.Y. (18%)• Peoria, Ill. (19%)• Binghamton, N.Y. (tied at 19%) Low-income families in these markets would have to pay between 30% and 39% of their income to cover the mortgage payment for a median priced existing home. Visit nahb.org/chi for tables and details. Discover more from Eye On Housing Subscribe to get the latest posts sent to your email.

Median Priced Existing Homes Less Affordable Than New Homes in Second Quarter2024-08-22T10:21:16-05:00

2024 First Quarter State-Level GDP Data

2024-06-28T14:20:40-05:00

Real gross domestic product (GDP) increased in 39 states and the District of Columbia in the first quarter of 2024 compared to the last quarter of 2023 according to the U.S. Bureau of Economic Analysis (BEA). Ten states reported an economic contraction during this time, while Maryland reported no change. The percent change in real GDP ranged from a 5.0 percent increase at an annual rate in Idaho to a 4.2 percent decline in South Dakota. Nationwide, growth in real GDP (measured on a seasonally adjusted annual rate basis) increased 1.4 percent in first quarter of 2024, which is much lower than the fourth quarter 2023 level of 3.4 percent. Retail trade; construction; finance and insurance; and health care and social assistance were the leading contributors to the increase in real GDP across the country. Regionally, real GDP growth increased in six out of the eight regions between the fourth quarter 2023 and first quarter of 2024. The percent change in real GDP ranged from a 2.7 percent increase in the Southwest region (Arizona, New Mexico, Oklahoma, and Texas) to a 1.5 percent decline in the Plains region (Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, and South Dakota). At the state level, Idaho (5.0 percent) posted the highest GDP growth rate followed by Nevada (4.4 percent) and Oklahoma (4.2 percent). On the other hand, Louisiana, Ohio, Minnesota, Illinois, Oregon, Nebraska, Iowa, Kansas, and the Dakotas all posted economic contractions in the first quarter of 2024. The construction industry was the leading contributor to growth in 10 states including Idaho and Nevada, the states with the first-, second-largest increases in real GDP, respectively. Agriculture, forestry, fishing, and hunting were the leading contributors to growth in Oklahoma, the state with the third largest increase in real GDP. However, this industry was the largest drag on state economies in the Dakotas, Kansas, Iowa, Nebraska, and Illinois. Discover more from Eye On Housing Subscribe to get the latest posts to your email.

2024 First Quarter State-Level GDP Data2024-06-28T14:20:40-05:00

State Level Employment Situation: May 2024

2024-06-25T16:19:07-05:00

Nonfarm payroll employment increased in 41 states and the District of Columbia in May compared to the previous month, while nine states saw a decrease. According to the Bureau of Labor Statistics, nationwide total nonfarm payroll employment increased by 272,000 in May, following a gain of 165,000 jobs in April. On a month-over-month basis, employment data was most favorable in California, which added 43,700 jobs, followed by Texas (+41,800), and then New York (+21,700). A total of 19,400 jobs were lost across the nine states, with Minnesota reporting the steepest job losses at 8,600. In percentage terms, employment increased the highest in Idaho at 0.9%, while Minnesota saw the biggest decline at 0.3% between April and May. Year-over-year ending in May, 2.8 million jobs have been added to the labor market across all 50 states and the District of Columbia. The range of job gains spanned from 1,300 jobs in Oregon to 316,700 jobs in Texas. In percentage terms, the range of job growth spanned 3.5% in Alaska and South Carolina to 0.1% in Oregon. Across the nation, construction sector jobs data1 —which includes both residential and non-residential construction—showed that 26 states reported an increase in May compared to April, while 22 states and the District of Columbia lost construction sector jobs. The two remaining states, North Dakota and Rhode Island reported no change on a month-over-month basis. Ohio, with the highest increase, added 7,000 construction jobs, while Tennessee, on the other end of the spectrum, lost 1,700 jobs. Overall, the construction industry added a net 21,000 jobs in May compared to the previous month. In percentage terms, Ohio reported the highest increase at 3.0% and Maine reported the largest decline at 2.1%. Year-over-year, construction sector jobs in the U.S. increased by 251,000, which is a 3.1% increase compared to the May 2023 level. Texas added 35,000 jobs, which was the largest gain of any state, while Maryland lost 5,000 construction sector jobs. In percentage terms, Alaska had the highest annual growth rate in the construction sector at 20.4%. Over this period, the District of Columbia reported the largest decline of 3.3%. For this analysis, BLS combined employment totals for mining, logging, and construction are treated as construction employment for the District of Columbia, Delaware, and Hawaii. ↩︎ Discover more from Eye On Housing Subscribe to get the latest posts to your email.

State Level Employment Situation: May 20242024-06-25T16:19:07-05:00

State & Local Tax Revenues: 2024 First Quarter Analysis

2024-06-24T10:18:29-05:00

The Census Bureau’s quarterly summary of State & Local Tax Revenue shows a 1.7% increase in property taxes paid, rising from a revised estimate of $754.1 to $766.7 billion in the seasonally adjusted four quarters ending in the first quarter of 2024. The rate of quarterly increases ticked up slightly, up from 1.5% in the fourth quarter of 2023 to 1.7% in the first quarter of 2024. This was the sixth straight quarter where the quarterly percentage increase was above the historical average since 2011 of 0.9%. Year-over-year, property tax revenue was 8.9% higher. This was the third straight decease in the year-over-year rate of change in the property tax data. Despite this, the first quarter of 2024 still experienced a year-over-year increase that is double what it has historically been. Property tax share of total State & Local tax collections in the first quarter stood at 37.9%, up a marginal 0.3 percentage points from the previous quarter. This share had been trending upward since the third quarter of 2022 when it was at 33.7%. Of total collections, property tax made up the largest share, followed by sales at 28.4%. Individual income tax represented 25.2% of tax revenue while corporate tax made up the remaining 8.4% of revenues for state & local governments in the first quarter of 2024. Discover more from Eye On Housing Subscribe to get the latest posts to your email.

State & Local Tax Revenues: 2024 First Quarter Analysis2024-06-24T10:18:29-05:00

Single-Family Permits Holding Steady in April 2024  

2024-06-18T09:20:35-05:00

Over the first four months of 2024, the total number of single-family permits issued year-to-date (YTD) nationwide reached 336,124. On a year-over-year (YoY) basis, this is an increase of 25.3% over the April 2023 level of 268,205. Year-to-date ending in April, single-family permits were up in all four regions. The range of permit increase spanned 36.4% in the West to 12.6% in the Northeast. The Midwest was up by 27.2% and the South was up by 22.7% in single-family permits during this time. For multifamily permits, three out of the four regions posted declines. The Northeast, the only region to post an increase, was up by 51.2%, while the West posted a decline of 36.4%, the South declined by 27.9%, and the Midwest declined by 11.6%. Between April 2024 YTD and April 2023 YTD, 48 states and the District of Columbia posted an increase in single-family permits. Rhode Island (-7.7%) and Alaska (-17.3%) reported declines in single-family permits. The range of increases spanned 63.8% in Arizona to 3.2% in Hawaii. The ten states issuing the highest number of single-family permits combined accounted for 64.9% of the total single-family permits issued. Texas, the state with the highest number of single-family permits, issued 56,832 permits over the first four months of 2024, which is an increase of 29.4% compared to the same period last year. The succeeding highest state, Florida, was up by 17.1% while the next highest, North Carolina, posted an increase of 17.2%. Year-to-date ending in April, the total number of multifamily permits issued nationwide reached 157,076. This is 20.1% below the April 2023 level of 196,589. Between April 2024 YTD and April 2023 YTD, 15 states recorded growth in multifamily permits, while 35 states and the District of Columbia recorded a decline. Oklahoma (+247.5%) led the way with a sharp rise in multifamily permits from 335 to 1,164, while Oregon had the biggest decline of 75.4% from 3,394 to 834. The ten states issuing the highest number of multifamily permits combined accounted for 65.8% of the multifamily permits issued. Over the first four months of 2024, Texas, the state with the highest number of multifamily permits issued, experienced a decline of 27.9%. Following closely, the second-highest state in multifamily permits, Florida, saw a decline of 33.2%. New York, the third largest multifamily issuing state, increased by 130.4%. At the local level, below are the top ten metro areas that issued the highest number of single-family permits. For multifamily permits, below are the top ten local areas that issued the highest number of permits. Discover more from Eye On Housing Subscribe to get the latest posts to your email.

Single-Family Permits Holding Steady in April 2024  2024-06-18T09:20:35-05:00
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