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The housing inventory crunch is driving up home prices in several markets where supply continues to lag demand, but borrowers can afford properties in some of these areas when local market conditions are taken into account.

Here's a look at 12 cities where home prices are higher, but local market conditions make them surprisingly affordable.

Home prices adjusted for regional affordability are lower than they were in 2000 for all except four of these 12 markets. Because borrowers in these areas find it easier to qualify for loans to buy homes with moderately higher prices, they are attractive markets for mortgage lenders.

But home prices have risen by between 1% and 11% year-over-year in these areas and mortgage interest rates rose recently as well, so they may not remain affordable for long. Borrowers may find there are fewer homes to choose from at less affordable prices if they wait to buy.

All of the houses in these markets are priced above $248,000, which is the median price paid for a resale home, according to National Association of Realtors data for December 2017. The full range of prices starts as low as $254,000, and in one case exceed more than $1 million.

The data, from the First American Real House Price Index, measures home price changes, taking local wages and mortgage rates into account "to better reflect consumers' purchasing power and capture the true cost of housing." The November 2017 data is ranked by RHPI value, where a reading of 100 is equal to conditions in January 2000.
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Twilight view of the city of Riverside, from Mount Rubidoux Park, in Riverside, California.
No. 12: Riverside, Calif.
Median Sales Price: $308,472
Real Home Price Index: 113.38
Year-Over-Year RHPI Change: 1.5%
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No. 11: Sacramento, Calif.
Median Sales Price: $333,750
Real Home Price Index: 110.17
Year-Over-Year RHPI Change: 7.2%
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No. 10: San Francisco, Calif.
Median Sales Price: $1,109,625
Real Home Price Index: 106.31
Year-Over-Year RHPI Change: 4.4%
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a nice clear day by the lake in downtown Austin Texas
No. 9: Austin, Texas
Median Sales Price: $276,094
Real Home Price Index: 104.37
Year-Over-Year RHPI Change: 1.3%
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Sunny Denver Skyline. Spring in Colorado. Denver Skyline and Snowy Rocky Mountains.
No. 8: Denver, Colo.
Median Sales Price: $341,750
Real Home Price Index: 99.20
Year-Over-Year RHPI Change: 7.9%
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Buildings along the downtown San Diego, CA waterfront skyline as seen from Coronado.
No. 7: San Diego, Calif.
Median Sales Price: $512,500
Real Home Price Index: 96.96
Year-Over-Year RHPI Change: 6.3%
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Dallas City Skyline at dusk, sunset. Dallas Texas downtown, business center. Commercial zone in big city. Dallas City view from Reunion Tower.
No. 6: Dallas, Texas
Median Sales Price: $254,792
Real Home Price Index: 92.51
Year-Over-Year RHPI Change: 9.0%
Portland, Ore.
View of Portland, Oregon from Pittock Mansion.
No. 5: Portland, Ore.
Median Sales Price: $368,785
Real Home Price Index: 91.56
Year-Over-Year RHPI Change: 3.5%
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Seattle waterfront during the summer
No. 4: Seattle, Wash.
Median Sales Price: $451,450
Real Home Price Index: 88.67
Year-Over-Year RHPI Change: 10.7%
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Washington DC, capital city of the United States. White House building. Presidential office.
No. 3: Washington, D.C.
Median Sales Price: $351,250
Real Home Price Index: 84.28
Year-Over-Year RHPI Change: 4.3%
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No. 2: New York, N.Y.
Median Sales Price: $491,581
Real Home Price Index: 83.99
Year-Over-Year RHPI Change: 5.9%
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Sailboats cruise the Charles River with the Boston skyline in the background
No. 1: Boston, Mass.
Median Sales Price: $441,756
Real Home Price Index: 79.64
Year-Over-Year RHPI Change: 4.6%
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