Only 22.5% of Phoenix homes are affordable for average family

AZ Big Media Phoenix renters need to work 61 hours to pay rent — a 42% jump  - AZ Big Media

By: AZ Big Media 

Only two metropolitan areas in Arizona had more affordable housing than the nation in the third quarter 2022. Nationally, just 42.2% of new and existing homes sold in the third quarter were affordable to a family earning the U.S. median income. The National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index latest release on November 10 indicated that affordability had fallen to its lowest level in more than 10 years. Arizona metropolitan areas experienced the lowest percentage of affordable homes since the current series began (in 2012). The share of homes affordable to those earning the median family income for their areas in Arizona were: 50.1% in Sierra Vista, 45.7% in Lake Havasu City-Kingman, 40.2% in Tucson, 38.9% in Yuma, 28.0% in Prescott Valley-Prescott, 22.5% in Phoenix, and 20.5% in Flagstaff.

House prices have begun to taper off. Phoenix reported an annual house price gain of 17.1% in August compared to 22.3% for July. The U.S. National Home Price NSA Index August gain of 13.0% was down from 15.6% in July. This was the largest deceleration in the history of the index according to the S&P CoreLogic Case-Shiller October 25 release. The 20-city composite had a 13.1% year-over-year gain in August compared to 16.0% in July. Prices declined on a month-to-month basis in all 20 cities included in the index. Miami had the largest 12-month house price gain at 28.6% while San Francisco posted the lowest twelve-month increase of 5.6%.

The U.S. Consumer Price Index (CPI-U) had a monthly increase of 0.4% in October on a seasonally adjusted basis, the same as in September. Over half of the monthly increase was contributed by shelter prices. Energy also increased, with gasoline and electricity prices rising. The all items index less food and energy increased 0.3% over the month. The annual inflation rate for the U.S. was 7.7% in October. Prices in the Phoenix metropolitan area were up 12.1% over the year in October (released on even numbered months), which was the highest of all areas tracked.

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