Only 45 percent of homes for sale in metro Denver are within financial reach of the middle class. And homeownership prospects are worse for the millennial generation, for whom only 33 percent of homes are affordable.

“If you rank them, Denver is the 14th least affordable among metros in the U.S. out of the 100 largest,” said Jed Kolko, chief economist for Trulia, which released a report on middle-class affordability Tuesday. “Affordability in Denver is not the crisis that it is in much of California and New York. But affordability is a bigger challenge in Denver than in most markets across the U.S.”

Affordablity in Denver, where median household income is $62,000, is on par with Boston, where the median is $69,000, the Trulia analysis shows.

This time last year, about 55 percent of homes for sale in metro Denver were affordable to middle-class buyers. Nationwide, about 59 percent of for-sale homes are affordable, compared with 62 percent last fall.

“Affordability is an even bigger challenge for millennials,” he said. “Just 49 percent of homes for sale nationally are within reach of a typical young household.”

In Denver, median income for millennial households — defined as having a head of household under age 35 — is $50,000.

Kolko blamed the gap on home-price increases that are outpacing income gains.

On average last year, home prices rose at roughly six times the pace of wages, which limited the benefits of historically low mortgage rates.

Even as home price growth has moderated in recent months, the prices continue to rise at more than double the annual increase in wages. Average hourly pay for nonsupervisory workers has risen 2.2 percent in the past year to $20.70, the Labor Department reported this month.

“Income has been growing at roughly the rate of inflation, which is only between 1 or 2 percent,” Kolko said in an interview. “Even if home price increases slow down to only 3 percent a year, that would still be faster than the rate at which incomes are rising. And on top of that, mortgage rates are likely to rise over the next year.”

Still, U.S. homebuilders’ confidence rebounded in November as sales expectations and buyer traffic improved.

The National Association of Home Builders/Wells Fargo index rose to 58 this month, up from 54 in October. That puts the index just short of September’s reading of 59, which was the highest level since November 2005, shortly before the housing bubble burst.

Readings above 50 indicate more builders view sales conditions as good rather than poor.

The index released Tuesday found sentiment had improved in the Northeast, Midwest, South and West. Builders expect sales to increase through the next six months.

Still, other indicators show that rising builder optimism has not necessarily been paired with a significant improvement in sales. Purchases of new homes were nearly flat in September, the Commerce Department reported. The pace of sales for newly built homes has improved a mere 1.7 percent so far this year compared with 2013, putting it below overall economic growth.

When the builder index was at a similar level in early 2006, the number of single-family housing starts was about 60 percent higher, noted Joshua Shapiro, chief U.S. economist at the forecasting firm MFR.

Most economists expect that the National Association of Realtors will report Thursday that sales of existing homes fell slightly in October. A survey by the data firm FactSet projects sales at an annual rate of 5.15 million for the month, down from 5.17 million in September.

Despite improved buying activity in recent months, sales in 2014 are still projected to lag last year’s total of 5.1 million. Sales of about 5.5 million homes generally are associated with a healthy real estate market.

The Associated Press contributed to this report.

Howard Pankratz: 303-954-1939, hpankratz@denverpost.com or twitter.com/howardpankratz