Home prices are at an all-time high in more than half of 112 metropolitan areas with a population of 200,000, according to Attom Data Solutions U.S. Home Sales Report. On top of that, most U.S. wages were flat until just recently and mortgage rates are on the rise.
Combined with a gap between incomes and home prices that is historically wide in certain local markets, these pressures on affordability puts certain areas at risk for a housing bubble.
Here's a look at 10 counties in metropolitan areas where home prices have outpaced wages by the biggest margins year-over-year, and purchasing power is at historic lows.
The data, from the Attom Data Home Affordability Index, measures average wages to buy a median-priced home on a recent and historical basis. The third-quarter 2017 data is ranked by the difference between the year-over-year increase in median home prices and the increase in average weekly wages needed to buy a median-priced house during the same period.
All the counties that follow have an affordability index below 100, meaning they are less affordable now than they have been historically on average; and in each area, more than 50% of average wages are needed to buy a median-priced home.
The ranking only includes counties that had a population of at least 100,000 and at least 100 homes sales during the quarter.
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