Housing Affordability

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The Blue Ribbon Housing Commission’s work included an analysis of what is considered an “affordable” home for Grand Forks’ buyers.  Many factors enter into this -- interest rates, property taxes, energy efficiency -- and each household's situation is unique.  However, starting with the assumption that a household can typically afford a home priced at three times its annual income, the table at right shows what that affordable home price is at various income levels.   

In Grand Forks in 2012, the ratio of median home sales price to median household income was 3.6. According to the rule of thumb above, “affordable” is defined as a ratio of 3.0 or lower.  Thus Grand Forks was considered moderately unaffordable at 3.6.   If the ratio hits 4.0 or higher, the housing market is considered severely unaffordable for the typical buyer.  Over 58% of households in Grand Forks earned less than $50,000 in 2010.  With the median home price approaching $180,000 in 2013, purchasing a home may be out of reach for the majority of Grand Forks households.    
  

"Affordable" Home Sale Prices by Income

Measuring Affordability

 

Median Home Value as Share of Median Household Income in Grand Forks

2007     3.34

2008     3.39

2009      3.87

2010     3.59

2011     3.70

US Census Bureau

         
While local home sale cost data is readily available, there is no similar source for rental cost data.  A local survey provides vacancy data twice a year but it does not include rental rates.    Census data shows that higher-priced units (those that rent for $750/month or more) are growing share of the local market, increasing from just 9% in 2000 to 31% in 2010.  The recent low vacancy rates are a driver for higher rents while the recent surge in construction of rental units may offset that.