by Valorie H. Rice
Senior Specialist, Business Information
The share of homes affordable to households earning the median income improved for some Arizona metropolitan areas and was lower in others during third quarter 2018. U.S. housing affordability remained at a ten-year low because of growth in interest rates and home prices according to the November 8 National Association of Home Builders/Wells Fargo Housing Opportunity Index release. Nationally, 56.4% of new and existing homes bought in the third quarter were affordable for families earning a median income of $71,900. In comparison, the share of affordable homes in the second quarter 2018 was 57.1%. Among Arizona’s metro areas, surprisingly after long being one of Arizona’s least affordable metros, Flagstaff had the largest increase in the share of homes affordable for median income households from one quarter to the next, placing affordability at 58.3%, compared to 54.3% in the second quarter. While on the other hand the share of affordable homes dropped 4.7 percentage points for Phoenix to 56.6%, dipping it below Flagstaff. At 48.4%, Prescott was ranked lowest in the state for affordability and was the only metro area in Arizona below the U.S. figure. Sierra Vista-Douglas had the highest affordability with 83.4% followed by Yuma at 76.4%, Tucson at 66.7%, and Lake Havasu City-Kingman at 61.6%.
Producer prices rose 0.6% in October; the highest seasonally adjusted monthly change so far this year for total final demand. Final demand goods increased 0.6% and final demand services increased 0.7% for the month. The unadjusted 12-month change in prices was 2.9%.
There were 1,462 Arizona bankruptcy filings in October, 7.6% more than the same month a year ago. Year-to-date, bankruptcies are up 3.5% in the state with filings increasing 2.3% for the Phoenix office, 6.4% for the Tucson office and 5.6% for the Yuma office. The Phoenix office includes Apache, Coconino, Gila, Maricopa, Navajo, and Yavapai counties. The Tucson office handles Cochise, Graham, Greenlee, Pima, Pinal, and Santa Cruz counties, while the Yuma office represents La Paz, Mohave, and Yuma counties. Chapter 13, individual debt adjustment, experienced the largest increase year-to-date at 7.6%.
The U.S. added 250,000 nonfarm payroll jobs in October according to the November 2 Bureau of Labor Statistics Employment Situation release. September employment numbers revised down to 118,000 from the originally published 134,000. Heath care, manufacturing, and construction had the largest gains in employment for the month. Average hourly earnings increased 3.1% over the year for October. The U.S. unemployment rate was unchanged at 3.7%.
The September U.S. trade deficit increased to $54.0 billion compared to the revised August figure of $53.3 billion. Both exports and imports were up over the month. Exports rose $3.1 billion to $212.6 billion and imports rose $3.8 billion to $266.6 billion. The year-to-date deficit of goods and services was 10.1% higher than the same period a year ago according to the November 2 joint release from the Bureau of Economic Analysis and Census Bureau.
Phoenix home prices increased 7.0% over the year in August. Both the nation at 5.8% and the 20-city composite at 5.5% had slightly slower year-over-year gains than the previous month according to the S&P CoreLogic Case-Shiller Indices released October 30. Las Vegas continued to be the metropolitan area with the highest 12-month house price gains at 13.9% followed by San Francisco at 10.6% and Seattle at 9.6%.
Real GDP for the U.S. increased at an annual rate of 3.5% in the third quarter 2018 according to the advance estimate released by the Bureau of Economic Analysis on October 26. Real GDP increased 4.2% in the second quarter and 2.2% in the first quarter. There are additional estimates based on more complete source data scheduled for release on November 28.
