Compared to Distribution

an indicator guage with the arrow in the green the value is in the best half of communities.

an indicator guage with the arrow in the yellow the value is in the 2nd worst quarter of communities.

an indicator guage with the arrow in the red the value is in the worst quarter of communities.

Compared to Target

green circle with white tick inside it meets target; red circle with white cross inside it does not meet target.

Compared to a Single Value

green diamond with downward arrow inside it lower than the comparison value; red diamond with downward arrow inside it higher than the comparison value; blue diamond with downward arrow inside it not statistically different from comparison value.

Trend

green square outline with upward trending arrow inside it green square outline with downward trending arrow inside it non-significant change over time; green square with upward trending arrow inside it green square with downward trending arrow inside it significant change over time; blue square with equals sign no change over time.

Compared to Prior Value

green triangle with upward trending arrow inside it higher than the previous measurement period; green triangle with downward trending arrow inside it lower than the previous measurement period; blue equals sign no statistically different change from previous measurement period.

green chart bars Significantly better than the overall value

red chart bars Significantly worse than the overall value

light blue chart bars No significant difference with the overall value

gray chart bars No data on significance available

Cost of Housing Index (CHI): Low-income Families

Select a Metropolitan Statistical Area (MSA)

Measurement Period: 2024

Filter: none (all Metropolitan Statistical Areas (MSA))

The NAHB/Wells Fargo Low-income Cost of Housing Index (CHI) is the percentage of low-income family earnings needed for a mortgage payment. The mortgage payment (numerator) is calculated by taking the median home price (assuming a 10% down payment) and adding taxes, home owner’s insurance and private mortgage insurance (PMI). 50% of median family income (the low-income denominator) is derived from data provided by the Department of Housing and Urban Development (HUD).

The CHI follows the same methodology, but the denominator is the area’s median income.

The CHI replaced the retired Housing Opportunity Index (HOI) but the two indices have different methodology and should not be compared.

Why is this important?

Families are likely house burdened with a CHI 31-50%; and severely house burdened with a CHI >50%. Conventional underwriting standards assume the cost of a mortgage, property taxes and property insurance should not exceed 28% of household income. In addition to principal and interest, cost then also includes estimated property taxes and property insurance for the home.

More...