Housing-NMN-Pickup-03292018
The demand for housing has been outpacing supply since early 2015, according to the National Association of Realtors, putting upward pressure on home prices and creating affordability challenges for potential homebuyers already badgered by tight inventory. However, consumer conditions vary geographically, meaning some states provide less stressful home-buying environments than others.

As house values grow, home purchasing power isn't just measured by how high or low prices are in a given area. Factors including local incomes and mortgage rates also help determine how much house someone can afford.

Real house prices, based not only on median home values but changes in incomes and rates, increased 2.3% both year-over-year and month-over-month in January, according to First American Financial.

But, some states are seeing healthy wage growth that's offsetting rising rates and prices. As a result, real house prices are declining and purchasing power is going up.

Mortgage lenders in states like Arizona can benefit from gains in homebuyer purchasing power, with real home prices falling nearly 5% in the state. In contrast, buyer conditions in New York present less than favorable circumstances for lenders, as real home prices shot up almost 9%, the greatest year-over-year increase of any state.

From Arizona to Vermont, here's a look at the 12 states where home purchasing power is going up. The house buying power amount reflects how much a typical buyer in that state can afford to pay for a home.

The data, from the First American Real House Price Index, measures home price changes, taking local wages and mortgage rates into account "to better reflect consumers' purchasing power and capture the true cost of housing." The January 2018 data is ranked by year-over-year change in RHPI value, where a reading of 100 is equal to conditions in January 2000.
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tomas del amo - stock.adobe.com

No. 12 Hawaii

House-buying power: $485,353
Real Home Price Index: 67.06
Year-over-year RHPI change: -1.32%
NMN032618-nebraska.jpg
Carbonbrain - stock.adobe.com

No. 11 Nebraska

House-buying power: $367,871
Real Home Price Index: 58.32
Year-over-year RHPI change: -1.47%
NMN032618-iowa.jpg
Historic State House on the University of Iowa Campus
Jesse Kunerth - stock.adobe.com

No. 10 Iowa

House-buying power: $350,882
Real Home Price Index: 59.97
Year-over-year RHPI change: -1.47%
NMN032618-alabama.jpg
sweet home alabama welcome sign at rest area stop off highway
digidreamgrafix - stock.adobe.com

No. 9 Alabama

House-buying power: $277,460
Real Home Price Index: 55.79
Year-over-year RHPI change: -1.7%
NMN032618-new-mexico.jpg
Nelson Sirlin - stock.adobe.com

No. 8 New Mexico

House-buying power: $285,958
Real Home Price Index: 74.40
Year-over-year RHPI change: -1.81%
NMN032618-vermont.jpg
Burlington, Vermont, USA autumn town skyline.
SeanPavonePhoto - stock.adobe.com

No. 7 Vermont

House-buying power: $373,706
Real Home Price Index: 65.63
Year-over-year RHPI change: -1.84%
NMN032618-oklahoma.jpg
Panorama of downtown Oklahoma City
Henryk Sadura/Henryk Sadura - stock.adobe.com

No. 6 Oklahoma

House-buying power: $295,047
Real Home Price Index: 61.07
Year-over-year RHPI change: -2.2%
NMN032619-wyoming.jpg
Devils Tower, Wyoming on a summer day.
David Harmantas/harmantasdc - stock.adobe.com

No. 5 Wyoming

House-buying power: $373,938
Real Home Price Index: 71.73
Year-over-year RHPI change: -2.52%
NMN032618-new-jersey.jpg
The city skyline in Atlantic City, New Jersey.
f11photo - stock.adobe.com

No. 4 New Jersey

House-buying power: $492,627
Real Home Price Index: 73.72
Year-over-year RHPI change: -3.46%
NMN032618-maryland.jpg
Baltimore, Maryland, USA Skyline over the Inner Harbor at dusk.
SeanPavonePhoto - stock.adobe.com

No. 3 Maryland

House-buying power: $519,733
Real Home Price Index: 69.22
Year-over-year RHPI change: -4.35%
NMN032618-arizona.jpg
Jason Yoder/Jason Yoder - stock.adobe.com

No. 2 Arizona

House-buying power: $268,071
Real Home Price Index: 60.08
Year-over-year RHPI change: -4.58%
NMN032618-west-virginia.jpg
Xavier Ascanio/Xavier Ascanio - stock.adobe.com

No. 1 West Virginia

House-buying power: $282,527
Real Home Price Index: 77.44
Year-over-year RHPI change: -5.24%
This article originally appeared in National Mortgage News.
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