Housing affordability moved slightly lower in the third quarter of 2016 because home prices continue to escalate, although the trend was offset by a small decline in mortgage rates.
The National Association of Home Builders' Housing Opportunity Index (HOI) indicates that 61.4 percent of new and existing homes sold between the beginning of July and the end of September were affordable to families earning the U.S. median income of $65,700. This is down from the 62 percent of homes sold that were affordable to median-income earners in the second quarter.
The national median home price increased from $240,000 in the second quarter to $247,000 in the third quarter, the NAHB said. Meanwhile, average mortgage rates edged lower from 3.88 percent to 3.76 percent in the same period.
"Historically low interest rates and firming job growth are positive indicators that housing markets across the nation will continue to gradually improve," said Ed Brady, chairman of the NAHB. "Home prices, however, continue to be affected by the rising costs of construction, both in terms of land and labor."
However, the average 30-year fixed mortgage interest rate spiked in the aftermath of Trump's election, rising from 3.38 percent on Nov. 8 to 3.8 percent on Monday, Nov. 14, according to Zillow.
The Nov. 14 mortgage interest rate is the highest in 2016, Zillow said, and it's also the largest one-week jump in interest rates seen on Zillow Mortgages since July 2013.
On Monday, Nov. 28, the average interest rate for a 30-year fixed-rate mortgage had risen from 3.94 to 4.03 percent, the National Association of Realtors said. At the same time last year, the rate was 3.95 percent.