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|
|Elizabethtown-Fort Knox, KY||94.4||68.1||136||2||1|
|Davenport-Moline-Rock Island, IA-IL||91.4||72.7||98||8||3|
|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.