Housing affordability grew slightly in the fourth quarter of 2014 according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI) released today.  NAHB said that the increase was due to interest rates which declined from 4.35 percent to 4.29 percent during the quarter and home prices which decreased in some markets and brought the national median down to $215,000 from the third quarter median of $220,800.

Nationwide the HOI shows that 62.8 percent of new and existing homes sold during the fourth quarter were affordable to families earning the U.S. median income of $63,900.  In the third quarter 61.8 percent of homes sold met that affordability criteria.

NAHB Chairman Tom Woods said, "This upturn in affordability for the final quarter of 2014 is a positive development and is in line with what we are hearing from builders in the field that more prospective buyers are starting to move forward in the marketplace."

Syracuse was the nation's most affordable major housing market with 92.8 percent of new and existing fourth quarter home sales deemed affordable to families earning the area's median income of $67,700.  Other major affordable markets were Akron and Dayton, Ohio; Harrisburg-Carlisle and Scranton-Wilkes-Barre, Pennsylvania.

Among smaller markets the most affordable was Cumberland, Maryland where 96.2 percent of homes sold during the fourth quarter were affordable to families earning the area's median income of $54,100. Other smaller housing markets at the top of the index include Kokomo, Indiana; Wheeling, West Virginia; Binghamton, New York; and Salisbury, Maryland.

Almost all of the least affordable markets, large and small, were located in the Golden State.  For a ninth consecutive quarter, San Francisco-San Mateo-Redwood City was the nation's least affordable major housing market.  Just 11.1 percent of homes sold there in the fourth quarter were affordable to families earning the area's median income of $100,400.

Other major metros in the least affordable category were Los Angeles-Long Beach-Glendale, Santa Ana-Anaheim-Irvine and San Jose-Sunnyvale-Santa Clara.  The only non-California market named was number five, New York-White Plains-Wayne.

The least affordable small market was Napa, where 12 percent of all new and existing homes sold were affordable to families earning the area's median income of $70,300. The remaining top five small markets were Santa Cruz-Watsonville, Salinas, Santa Rosa-Petaluma, and San Luis Obispo-Paso Robles.