Analysis: Buying a home more affordable than renting in both Sullivan and Washington counties

There’s a lot of news about how rising home prices are torpedoing today’s buyers. While that’s certainly the case in some markets, it’s not what an analysis of Sullivan and Washington counties shows.

Attom Data Solutions Q1 Home Affordability Index data gives buying a more affordable position than renting in both counties. And Sullivan County scored a more affordable position for both renters and buyers.

The rent/buy position in the analysis comes from a comparison of the rent trends for 3-bedroom units, wages, median home prices and the percent of wages it takes for both renting and buying.

The primary factors driving the local buy positions include decreasing rents, increasing wages and slow home price appreciation.

The bottom line is it took 18.5% of the average wage in Sullivan County to buy a median-priced home. It Washington County it took 25.1%.

The share of income to rent was a little closer. In Sullivan renting required 25.4% of a person average while it consumed 28.1% in Washington County.

Attom’s data show 2017 3-bedroom fair market rents in Sullivan declined 3% to $913. They were down 1.6% to $917 in Washington County.

On the positive side, both counties are seeing wages increase faster than rents. The picture for home prices vs. wages was mixed. The analysis says wages were increasing faster than home prices in Sullivan, but not in Washington County.

From the national perspective, “Home affordability continued to worsen in the first quarter, not surprising given the continued strong growth in home prices combined with the recent rise in mortgage rates,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “Stronger wage growth is the silver lining in this report, outpacing home price growth in more than half of the markets for the first time since Q1 2012 when median home prices were still falling nationwide. If that pattern continues, it will help turn the tide in the eroding home affordability trend.”

A noteworthy affordability contrast in the report is it took more than 43% of average wages need to buy a home in 97 of the 379 counties studies. And in five counties it required 100%.   Buying in Sullivan Co. required 18.5%, and it took 25.1% of the average wage to buy in Washington.

Attom’s report analyzed median home prices derived from publicly recorded sales deed data collected by ATTOM Data Solutions and average wage data from the U.S. Bureau of Labor Statistics. The affordability index was based on the percentage of average wages needed to make monthly house payments on a median-priced home with a 30-year fixed rate mortgage and a 3 percent down payment, including property taxes, home insurance, and mortgage insurance. Average 30-year fixed interest rates from the Freddie Mac Primary Mortgage Market Survey were used to calculate the monthly house payments. Only counties with sufficient home price and wage data quarterly back to Q1 2005 were used in the analysis.