Ashley Morales and Randy Valencia

Math Modeling Challenge: Housing Affordability

April 30, 2024

At first, we made sure that all the dates were accurate but soon found there was only 60 years of data

for the houses sold in the last 80 years and only 38 years of data for household income in the last 40

years. We calculated the median for houses sold from 1992 to 2022. We also found the median

household income from 1992 to 2022. The formula we used was the rate of the number of periods

from the initial value; 1992 01-01 to the final value; 2022-10-01 for the price of home sold and the

rate of the number of periods from the initial value;1992 01-01 to the final value; 2022-10-01 for

household income, this was going us to find the median. But realized we were going about this all

wrong, we had to find the growth rate of the last ten years for the household income which is 0.18%

then multiplying it by the last average of the year we were given which was $74,580 and got

$13242.4, which is the median for the next 10 years. Then for the next 30 years of the household

income we repeated the same process but did the last 30 years to the current year and got 0.26% for

the growth rate and multiplied it by the last average of the year we were given which was $74,580

and got $19,359.81. Then we repeated the process for home prices for the next 10 years and did the

last 10 years to the current year and got 0.61% for the growth rate and multiplied it by the last

average of the year we were given which was $417,700 and got $258,974. For the next 30 years we

did the last 30 years to the current year and got 2.34% for the growth rate and multiplied it by the

last average of the year we were given which was $417,700 and got $977,418. Randy and I, believe

that the most affordable among stated years; 2004, 2024, 2034. 2004 is the most affordable because

the difference between house prices and household income is the smallest. And 2024 is ranked

second and 2034 is last in affordability.

Drawing a Connection:

By solving the problem we gain an understanding of how our future economical states will be

like and what will have to work for just to buy regular but quite expensive houses that seem like

they will forever raise prices. Not only does this apply to houses it can also be applied on cars,

technology, and just daily essentials. By measuring both price and affordability while inputting

the household income we gain a greater understanding of globe prices (inflation.)