New analysis: Spring homebuying season may be the last affordable one for some time.
Aly J. Yale The Mortgage Reports Contributor
February 10, 2020 – 1 min read
If you’re looking to buy a home this year, then you might want to pull the trigger — and soon. As one expert says: “This spring homebuying season may be the last affordable one in a while.”
Let the homebuying commence
A new analysis from Realtor.com makes the claim that spring 2020 will likely be the most affordable homebuying market we’ll see for some time.
According to the findings, overall housing affordability increased 6% in 2019, and 87 of the top 100 metros saw improved affordability during that time. The jumps in affordability are largely thanks to increased incomes, lower mortgage rates, and decreasing listing prices.
It might not last for long, though. According to Sabrina Speianu, Realtor.com’s senior economic research analyst, we’d need a significant drop in interest rates to bump affordability up any further.
“As interest rates stabilize, this spring’s homebuying season might be the last opportunity to take advantage of increases to home affordability,” Speianu says. “With stabilizing interest rates, only income growth or increased construction of affordable homes can provide continued increases to home affordability.”
Homebuying affordability jumped the most in these states
In the meantime, homebuyers in Des Moines, Iowa have reason to rejoice. The city saw the biggest jump in affordability in the entire nation over the last year. Incomes were up 5.6% and listing prices dropped 9.5%.
Other cities where homebuying got more affordable were Minneapolis; Spokane, Wash.; Omaha, Neb.; and Raleigh, N.C.
On the other end of the spectrum is Tulsa, Okla., which saw the biggest drop in affordability over the year. Other cities that experienced decreases include Thousand Oaks, Calif.; Winston-Salem, N.C.; Bakersfield, Calif.; and Philadelphia.