Mid Michigan cities among the most affordable in the nation

Excerpts from CNNMoney.com story published today:


The most affordable U.S. housing markets

The Midwest has the most affordable housing. California has the least.

By Les Christie, CNNMoney.com staff writer
July 1 2007: 2:37 PM EDT

NEW YORK (CNNMoney.com) -- The housing slump has its benefits; affordability improved in many metro areas across the nation during the first three months of this year.
According to a report from Wells Fargo Bank and the National Association of Home Builders (NAHB), about 44 percent of all homes sold in the United States during the first three months of the year were affordable to families earning the median household income for the area they lived in.

NAHB President Brian Catalde, said, "This is up from 41.6 percent of homes sold in the final quarter of 2006, and is likely the result of lower house prices as well as the very favorable financing conditions that existed at the beginning of this year."

The Indianapolis area, where the median home cost $116,000, was the most affordable major U.S. market for the period, but joining it at number one this time was the Youngstown, Ohio metro area ($78,000). In both places, the index judged affordable 89.0 percent of the homes sold.

A smaller market area, Kokomo, Indiana ($93,000), led all cities; 93.5 percent of all homes sold there could be bought by median income households. Also highly affordable were Lansing, Michigan ($100,000, 91.1 percent) and Lima, Ohio ($78,000, 90.4 percent).

The top 13 markets were all located in the Midwest region. Cumberland, Maryland ($81,000, 86.8 percent), representing the South, was the highest ranked city in the rest of the United States. Elmira, New York ($69,000, 86.7 percent) was close behind. The most affordable western city was Pueblo, Colorado ($115,000, 76.3 percent).

California dominated the list of most unaffordable cities with just 3.0 percent of Los Angeles residents able to buy the median home, priced at $525,000. In nearby Santa Ana ($610,000, 4.4 percent) and Salinas ($569,000, 4.6 percent), conditions weren't much better.
The New York metro are, where the median home cost $500,000, was the least affordable place outside California. It recorded an affordability index score of 6.0 percent. Miami ($288,000, 10.0 percent) trailed all other southern cities and Chicago ($248,000, 46.5 percent) brought up the rear in the Midwest.


The Lansing area, Battle Creek, Flint, Detroit, Saginaw, Bay City & Monroe Areas of Michigan all made the top 15 cities, with Lansing being #2 in the country with 91.1% of homes being affordable to a family with the median household income for the area ($64,000). Jackson was not in on the list due to market size, but I would anticipate it to be very high on the list if it had been.

So what does this all mean? Well, if you are buying a home soon you can look forward to favorable pricing! Home prices have moderated in the past 12 months, bringing them in line with buyer expectations. This is a positive step toward turning around the housing market. Affordable housing will encourage more first-time buyers, and possibly more out of town buyers.

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ERA Reardon Realty