Affordable housing is a frequent topic of conversation in many localities. Whether housing is truly "affordable" in Harrisonburg is certainly a matter of opinion, but let's look at some specific facts and data to reach more objective conclusions.

According to the U.S. Department of Housing and Urban Development, "affordable housing" is defined as housing in which an occupant pays no more than 30 percent of gross income on housing-related costs, including utilities.

To determine if housing is affordable in Harrisonburg and Rockingham County, we need to start with local gross median income.

According to the Federal Reserve Bank of St. Louis, the median household income for 2023 was:

• Harrisonburg: $58,597
• Rockingham County: $79,332

Now, let's work backwards. To figure out at what price point housing is considered affordable, we first need to calculate 30% of household income:

• Harrisonburg: $58,597 × 0.3 = $17,579
• Rockingham County: $79,332 × 0.3 = $23,799

For context, these numbers represent 30% of median household income. This means that for housing to be considered affordable, residents of Harrisonburg must spend less than $17,579 per year on housing costs, while Rockingham County residents must spend less than $23,799.

Since HUD's 30% threshold includes utilities and other housing-related costs beyond mortgage payments, let's make some quick estimates:

Now let's subtract these non-mortgage costs from the 30% median household income threshold to determine how much money remains for mortgage payments -- which will help us identify the affordable price point for local housing.

• Harrisonburg: $17,579 - $3,000 = $14,579 ÷ 12 = $1,214.92 / month
• Rockingham County: $23,799 - $3,000 = $20,799 ÷ 12 = $1,733.25 / month

Calculating Affordable Home Prices

Now that we know how much of the median household income can reasonably be allocated to mortgage payments, we can determine the approximate home purchase price that would keep those payments within the "affordable" range.
Harrisonburg

Using a 6.25% interest rate on a 30-year mortgage, we can work backward from Harrisonburg's affordable monthly payment limit of $1,214.92. Based on this monthly limit -- and assuming a 5% down payment -- the maximum affordable loan amount is approximately $162,450, which translates to the following:

• Purchase Price: $171,000
• Required Down Payment: $8,550
• Loan Amount: $162,450
• Estimated Monthly Principal & Interest: $1,000.23
• Estimated Monthly Property Taxes: $143.93
• Estimated Monthly Homeowners Insurance: $68.00
• Total Estimated Monthly Payment: $1,212.16

Maximum Purchase Price With a 20% Down Payment

Using the same affordable monthly payment limit of $1,214.92, a 20% down payment allows for a slightly higher purchase price while keeping the total monthly cost within budget. With a 20% down payment, the maximum affordable loan amount is approximately $156,800, which produces the following:

• Purchase Price: $196,000
• Required Down Payment: $39,200
• Loan Amount: $156,800
• Estimated Monthly Principal & Interest: $965.44
• Estimated Monthly Property Taxes: $164.97
• Estimated Monthly Homeowners Insurance: $78.00
• Total Estimated Monthly Payment: $1,208.41

Rockingham County

Maximum Purchase Price With a 5% Down Payment

Using the same 6.25% interest rate on a 30-year mortgage, we can work backward from Rockingham County's affordable monthly payment limit of $1,733.25. Based on this monthly limit -- and assuming a 5% down payment -- the maximum affordable loan amount is approximately $241,300, which translates to the following:

• Purchase Price: $254,000
• Required Down Payment: $12,700
• Loan Amount: $241,300
• Estimated Monthly Principal & Interest: $1,485.73
• Estimated Monthly Property Taxes: $143.93
• Estimated Monthly Homeowners Insurance: $102.00
• Total Estimated Monthly Payment: $1,731.66

With a 20% Down Payment

For households able to make a 20% down payment, the affordable monthly limit allowed for a slightly higher price point while remaining within budget. With Rockingham County's limit of $1,733.25, the maximum affordable loan amount is approximately $235,200, resulting in the following:

• Purchase Price: $294,000
• Required Down Payment: $58,800
• Loan Amount: $235,200
• Estimated Monthly Principal & Interest: $1,448.17
• Estimated Monthly Property Taxes: $166.60
• Estimated Monthly Homeowners Insurance: $118.00
• Total Estimated Monthly Payment: $1,732.77

Comparing Affordability to Actual Home Sales

With the estimated affordable home price ranges established for both Harrisonburg and Rockingham County, the next step is to compare these affordability thresholds to the homes that actually sold over the past year. This allows us to measure not just theoretical affordability, but practical availability within the current housing market.

Based on the calculations above, an affordable purchase price for Harrisonburg residents -- given median income and a 6.25% mortgage rate -- ranges from approximately $171,000 (with 5% down) to $196,000 (with 20% down).

Here's how the real market compares:

• Homes sold for less than $171,000 in past year: 6
• Homes sold for less than $196,000 in past year: 8
• Total homes sold in Harrisonburg over the past year: 251

This means that:

• At the $171,000 affordability level, only 2.39% of homes sold would be considered affordable.
• At the $196,000 level -- assuming a full 20% down payment -- only 3.19% of homes sold fall under this threshold.

In other words, more than 96% of homes sold in Harrisonburg last year were priced beyond what the median household could afford under HUD's definition of affordability, even when assuming a 20% down payment. The data clearly shows extremely limited market availability for households at or near the city's median income level.

For Rockingham County, our affordability calculations place the affordable home price range between $254,000 (with 5% down) and $294,000 (with 20% down).

Here's how the past year of home sales compares:

• Homes sold for less than $254,000 in past year: 99
• Homes sold for less than $294,000 in past year: 212
• Total homes sold in Rockingham County over the past year: 963

This means:

• At the $254,000 level, 10.28% of homes sold would meet the affordability threshold.
• At the higher $294,000 level -- assuming 20% down -- 22.02% of homes sold fall within the affordable range.

Compared to Harrisonburg, Rockingham County offers a higher percentage of homes that are affordable to households earning the local median income. Still, even at the more generous affordability threshold, the majority of homes sold remain out of reach for median-income households.

Homeownership at the median income level presents clear challenges. With only 2.39% to 3.19% of homes sold in the past year falling within the affordable purchase price range we calculated, the supply of homes attainable for the typical buyer is extremely limited. That said, this does not necessarily mean that all housing is out of reach -- only that entry into homeownership is difficult for households earning the city's median income under current market conditions.

In Rockingham County, the situation is somewhat more favorable. Depending on the size of the down payment, between 10.28% and 22.02% of homes sold last year fall within the affordable range for the median household. While still not a majority of the market, this represents a wider range of attainable options compared to Harrisonburg.

It's important to emphasize that these findings are specific to homeownership, which has become more difficult across the country due to higher interest rates, rising home prices, and slower income growth.

The affordability thresholds we calculated -- 

• $1,214.92/month for Harrisonburg
• $1,733.25/month for Rockingham County

 -- represent what median-income households can reasonably spend on mortgage payments, after accounting for routine housing-related utilities such as water, electricity, and internet. These monthly amounts do not reflect the rental market.

In other words, while buying a home may be challenging for many households -- something true both locally and nationally -- there are numerous rental options in both Harrisonburg and Rockingham County that fall within these affordability ranges, depending on household size, location, and individual circumstances.

Homeownership affordability is limited for median-income households in both localities, particularly in Harrisonburg. However, this does not mean that all housing is unaffordable. Instead, the data suggests a more nuanced picture:

• Buying a home is difficult for many households, locally and nationally.
• Rental housing may still offer options within HUD's affordability guidelines.
• Affordability varies widely by down payment size, household composition, and housing type.

In short, while the pathway to homeownership may be narrow, the broader housing landscape includes a variety of living arrangements -- some of which may fall within what median-income residents in Harrisonburg and Rockingham County can reasonably afford.

Because of the limited number of for-sale homes available at these price points, many households at these income levels will naturally remain renters rather than buyers.

I'd love to chat! 

You can call/text me at 540-830-5097, or send me an email at luke@lukewrogers.com