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NBC News Home Buyer Index
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The following counties were ranked as the least difficult areas when ranked by the four contributing factors:
- Cost: Iroquois County, Illinois is the most cost-effective or affordable real estate market among rated counties in the U.S.
- Competition: Somervell County, Texas is the least competitive housing market of the counties measured in the U.S.
- Scarcity: Imperial County, California is the least scarce housing market among the areas measured.
- Economic instability: Macon County, Tennessee, has the most stable local economy among the areas measured.
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The index assesses cost, competition, scarcity and economic instability.
Cost, the most heavily weighted element, measures how much a home costs relative to household income and inflation, as well as expenses like insurance costs, according to NBC News.
Competition looks at the level of demand in an area or how many buyers are in the market for a home.
Shortage refers to the supply of homes listed for sale in an area and how many more are expected to come on the market in the next month.
And finally, economic instability considers market volatility, unemployment levels and interest rates in an area.
NBC News Home Buyer Index was developed by NBC News in conjunction with housing experts such as a real estate analyst and a banking economist at the Federal Reserve Bank of Atlanta.
On a scale of zero to 100, the index score represents the level of difficulty in buying a home in a US county: The higher the value, the more difficult it is to buy a home in that area, according to NBC.
But to compare counties to each other, it’s important to consider the index’s ranking, as “the rankings provide context to the scores,” said Joe Murphy, data editor at NBC News who co-created the index.
A low ranking on the index — or closer to the value of 1,310, the number of counties measured in this month’s report — suggests the county has better market conditions for potential buyers. In other words, a county ranked number one on the index “is the worst,” Murphy said.
For most Americansbuying – and even keeping – a house in the USA is still expensive.
The median sales price of homes sold in the U.S. was $420,800 in the first quarter of 2024, according to the U.S. Department of Housing and Urban Development and the U.S. Census Bureau by the Federal Reserve.
In addition to the high cost, the 30-year fixed-rate mortgage in the US is still close to 7%. Borrowing costs are unlikely to change significantly as the Federal police held rates steady at its June meeting.
However, if you plan or want to own a home, there are ways to prepare, experts say.
If you want to be a homeowner but remain on the sidelines, “preparing yourself financially is one of the most important things people can do” before buying a home, said Danielle Hale, chief economist at Realtor.com.
“Spend more time getting your finances in good shape,” said Jacob Channel, senior economist at LendingTree. “It’s really important, especially when you’re making a six-figure purchase, to really take your time.”
Here are three things to consider:
1. Increase your credit score: Take a moment to pay off debt and raise your credit score, Channel said.
Your credit score helps measure how creditworthy you are as a borrower, Hale said. You could qualify for a home purchase with a minimum credit score of 500, depending on the lender, according to for Experian. But having a higher score can help you get better mortgage terms, Hale said.
“Doing what you can to improve your credit score will increase your chances of getting a lower mortgage rate,” Hale said.
2. Seek pre-approval from creditors: “It’s worth starting the process sooner rather than later so there aren’t as many surprises,” Hale said, especially for buyers who have never purchased a home before.
Rate lock policies will depend on the lender. In some cases, a lender will let you lock in a mortgage rate after pre-approving you, Channel said.
But generally, a pre-approval isn’t enough to guarantee an interest rate, Hale said, “because you can’t lock in a mortgage rate until you have a complete mortgage application.”
“And you can’t make a full mortgage application until you have a specific property you want to buy,” she said.
Once a buyer makes an offer on a property and officially begins the application process, it’s possible the lender can guarantee a mortgage rate if you ask, Hale said. Depending on the lender, the mortgage rate will be locked in for a period of 30 to 60 days, which is “enough time for the closing process to happen,” Hale said.
Ask your lender what the rate lock period is and ask at what stage in the process the mortgage rate is locked, Hale said.
3. Budget and Save Intentionally: “What people should do is budget and save,” Channel said. The more time you dedicate to saving money for expenses like down payments and closing costs, he said, “the better off you will be.”
When someone becomes a homeowner, “they will have a higher monthly payment than they had before,” Hale said. So as you prepare for homeownership, consider setting aside an extra down payment, she suggested.
This would help build savings for a down payment or emergency fund and “give you an idea of how comfortable paying for housing really is,” Hale said.
“It’s better to be a renter who can afford your rental unit than to be a homeowner who can’t afford your home,” Channel said.