NH home-buying affordability drops to 20-year low

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NH housing affordability index graphic
NH Affordability Index. Graphic Courtesy New Hampshire Association of Realtors

New Hampshire residents looking to buy a home are less able to afford it than they’ve been in 20 years, according to the New Hampshire Association of Realtors November market report.

Price spikes and rising interest rates have dropped New Hampshire’s affordability index to a 20-year low 69, according to the NHAR.

The index number means that the median income is 69 percent of what’s necessary to qualify to buy a median-priced home. The index measures not only the price of the home and current interest rates, but property taxes and insurance for a median-priced home. (Median means half are higher and half are lower.)

The affordability index 12 months ago was 106 for a single-family homebuyer in New Hampshire. Those who want to buy a townhouse or condo are in a little better position. The affordability index is 84, down from 140 this time last year. 

The median sales price for a single-family home was $435,000 at the end of November, up 8.3 percent from November 2021’s $401,750.  The median price for townhouse/condo properties was $355,000, up 16.4% from $305,000,

The average mortgage interest rate on a 30-year fixed-rate mortgage for a borrower with a credit score of 740 or higher is 6.95 percent, higher for those with lower credit scores. That’s up from lows around 2.96 percent last year.

NH percent of list price paid
NH Percent of lLst Price Received. Graphic Courtesy New Hampshire Association of Realtors

Good-ish News

There is some good news in the residential real estate market, but nothing that’s going to cause a big disruption, according to the NHAR.

The number of homes for sale in the state as November ended was 1,853, more than 20 percent higher than last year’s 1,542.

The NHAR’s release that accompanied the monthly report noted that it’s the second month in a row listed homes increased over last year’s by a double-digit percentage. However, “That’s still less than half of the inventory of just three years ago, and a far cry from the 10,000-plus homes on the market 10 years ago,” the release said. “Affordability remains reflective of today’s generally scant supply,”

Inventory is higher than it was this time last year, but slightly lower than in October. Low inventory has been an issue for more than a decade, and drives price increases, as well as buyers not being able to find suitable housing overall. At the end of November, there was 1.5 months’ supply of single-family home inventory on the market, up from 1.1 last November. In October, there was 1.7 months’ supply.

There was less than a month’s inventory available from December to April, but since June it’s toggled between 1.7 and 1.9

Inventory is measured by how many months it would take to sell off what’s available if nothing else came on the market. A “balanced” market is five to seven months’ supply, a level it hasn’t been at for more than five years, Dave Cummings, NHAR director of communications, told InkLink last month. The last time there was two months’ inventory available was July 2020, according to NHAR statistics.

November Market Highlights

Some other takeaways from the November NHAR market report:

  • New listings for the month were down, with 880 new single-family home listings in November compared with 1,097 in November 2021. The same was true for townhouse condos, 300 this year and 363 last year.
  • Single-family home buyers paid 99.9 percent of list price in November, as opposed to 101.6 percent in November 2021; townhouse/condo buyers paid 100.9% as opposed to 101.7 percent.
  • Houses are spending an average 28 days on the market, up two days from November 2021; townhouse/condos are spending an average 24 days on the market, up three days from this time last year. 


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About this Author

Maureen Milliken

Maureen Milliken is a contract reporter and content producer for consumer financial agencies. She has worked for northern New England publications, including the New Hampshire Union Leader, for 25 years, and most recently at Mainebiz in Portland, Maine. She can be found on LinkedIn and Twitter.