By DON FENLEY

TRI-CITIES, Tenn. – Existing single-family and condo home sales in the affordable price ranges are down 22% so far this year. During the first 11 months of this year there were 2,662 of those sales accounting for 37% of all sales. But where the market was in November paints a slightly different picture.

Active inventory of the same products increased 20% (513 listings) and the 282 new listings in the targeted price ranges were up 11%.

November’s numbers from NETAR’s Homes Sales Report don’t mean the region is skating an affordable housing crunch. It exists and gets a lot of attention from civic and government groups because overall affordability is at an all-time low created by home prices – and rents – increasing a lot faster than wages.

Third-party affordability studies illustrate the big picture.

The Atlanta Federal Reserve Bank’s Homeownership Affordability Tracker says new owners are paying hundreds of dollars a month more than they did since the first of the year. It also shows most of those new buyers are spending more than the recommended 30% of their income on housing.

ATTOM, one of the nation’s largest real estate data firms, issues quarterly affordability analysis based on a financing model that shows prices have outstripped the purchasing power of a typical worker earning the local median wage’s ability to buy a median priced home.

The situation includes workforce housing people like beginning police officers, firefighters, and schoolteachers. And there are ample openings for them. There’s also examples of struggles to find housing they can afford. And it’s a fact that most of the new jobs and job opening are in the lowest-paid positions.

Without doubt, some of the big picture affordability studies are skewed by the region’s vigorous growth of higher-priced homes.

Attracting new residents is a critical part of the region’s effort to sustain and grow its economy. Young families, or individuals beginning a career, are prized. But there’s a catch. The ability to find affordable housing can be a deal breaker.

Although workforce housing and affordable housing are not defined by the same metrics, both are a critical part of the coming year’s housing market. The current outlook calls for increased sales and little, if any, relief from the current prices.

Categories: REAL ESTATE