What is HOI?
The National Homebuilders Association (NAHB) will release the latest Housing Opportunity Index (HOI) this week. According to the organization, the HOI “for a given area is defined as the share of homes sold in that area that would have been affordable to a family earning the local median income, based on standard mortgage underwriting criteria. Therefore, there are really two major components — income and housing cost.”
This week’s report will cover the second and third quarters of 2019. Q1 saw an HOI of 61.4%, up nearly five points from the Q4 2018. For the first quarter of this year, NAHB put the national median price of homes in 239 metro areas at $260,000, down $3000 from the previous quarter. The weighted interest rate dropped as well to 4.64%.
Affordable homes in Alaska
Fairbanks, Alaska ranked first by affordability for Q1 2019 with more than 94% of homes considered “affordable for median income.” Here’s a look at the top five.
| HOI 1st Qtr 2019 | 2019 | 1st Qtr 2019 | 1st Qtr 2019 | ||
| Metro Area | Share of Homes | Median | Median | Affordability | |
| Affordable for | Family | Sales | Rank | ||
| Median Income | Income | Price | National | Regional | |
| (000s) | (000s) | ||||
| Fairbanks, AK | 94.7 | 92.4 | 233 | 1 | 1 |
| Elizabethtown-Fort Knox, KY | 94.4 | 68.1 | 136 | 2 | 1 |
| Kokomo, IN | 94.3 | 65.2 | 116 | 3 | 1 |
| Elmira, NY | 94.2 | 74.0 | 85 | 4 | 1 |
| Cumberland, MD-WV | 94.0 | 59.3 | 96 | 5 | 2 |
| Youngstown-Warren-Boardman, OH-PA | 93.3 | 59.8 | 85 | 6 | 2 |
| Binghamton, NY | 92.9 | 70.5 | 96 | 7 | 2 |
| Davenport-Moline-Rock Island, IA-IL | 91.4 | 72.7 | 98 | 8 | 3 |
| Monroe, MI | 91.2 | 79.0 | 154 | 9 | 4 |
| Battle Creek, MI | 91.0 | 64.2 | 100 | 10 | 5 |
Problems in Silicon Valley
San Francisco came in last with just 6.9% homes “affordable for median income.” The median family income here is $122,000 but the median sales price is $1.27 million.
- Generations: “It’s difficult to qualify for a mortgage” - February 17, 2020
- The Affordable Housing Shortage & Job Growth - January 21, 2020
- New HOI numbers due this week - November 4, 2019
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