The share of homes considered to be affordable to the average wage earner in the United States hit its best level in more than two years, according to the housing data company ATTOM Data Solutions. However, the typical worker was still not able to afford two-thirds of the properties available.

In its U.S. Home Affordability Report for the first quarter of 2020, 319 of the 483 counties analyzed in the report—66 percent—were considered unaffordable to the average earner. This share was down from 70.4 percent in the fourth quarter of 2019 and 69.8 percent in the first quarter of 2019.

Affordability was determined using average weekly wage data from the U.S. Census Bureau and comparing it to the amount of money needed to make monthly payments on a median-priced home, including the mortgage, insurance, and property taxes. A home was considered affordable if these expenses, using a 3 percent down payment, created a maximum debt-to-income ratio of 28 percent.

The report also found that payments on a median-priced home of $252,500 typically used up 31.1 percent of the average national wage. This share was down from 31.4 percent in the fourth quarter of 2019 and 31.6 percent in the first quarter of 2019, the lowest percentage since the fourth quarter of 2017 when the typical debt-to-income ratio for payments on a median-priced home was 30.8 percent.

"Home affordability has inched ahead this year across the United States as buying a house or condo gets closer and closer to the level where the average wage earner can swing the deal within standard lending guidelines," said Todd Teta, chief product officer at ATTOM Data Solutions. "While the national median price still remains a bit out of reach for the average wage earner, the affordability gap has narrowed to the smallest point in more than two years. It seems bizarre that median home prices have risen 8 percent over the past 12 years while average wages grew by less than half that amount. But falling interest rates continue making up the difference, dropping monthly homeownership payments in the majority of the country."

The most unaffordable county was Kings County, N.Y., where a buyer would need 108.1 percent of the typical wage to afford a median-priced home. The typical worker would need 92.8 percent of the typical wage to afford a median-priced home in Santa Cruz County, Calif., and 91.5 percent of the average wage in Marin County, Calif.

Home price increases were outpacing wage growth in 64 percent of the analyzed counties. The largest markets where this trend was occurring included metro areas in Los Angeles, Phoenix, and Miami-Dade, Fla. The largest markets where wage growth was outpacing home price growth included metro areas in Chicago, Houston, New York City, and Seattle.

Two-thirds of the counties—66.9 percent—were more affordable than historic averages. This share was up from 55.1 percent in the fourth quarter of 2019 and 49.7 percent in the first quarter of 2019.

In 195 counties, buyers earning an average wage needed to contribute less than 30 percent of their income to afford a median-priced home. The largest market was Baltimore, where just 9.5 percent of the typical buyer's income was needed to purchase a home. The share stood at 10.8 percent in Madison County, Ind. and 11.4 percent in Bibb County, Ga.

In New London County, the median home sales price was $209,000 while the average annualized wage was $56,680. The typical worker buying a median-priced home needed to use 29.9 percent of their monthly income.