Top 5 Most and Least Affordable Housing Markets in the United States

RealtyHop released its Housing Affordability Index in December. According to a study, homeowners spend more than 30% of their income on their homes in 75 of the 100 largest cities.

As a result of falling home prices in the second half of the year, is it time for you to start looking for your own home?

According to a report from RealtyHop, a service that provides information about home prices, no. According to its Housing Affordability Index, homeowners spend more than 30% of their income on housing costs in 75 of the nation’s largest 100 cities.

In order to produce an index of the burden of homeownership and housing affordability, the study looked at the 100 largest cities in the United States.

A common definition of unaffordable homes is that way. The index takes into account the median home price and the average household income.

The index assumes a 5.5% interest-rate 30-year fixed-rate mortgage. The majority of buyers would actually pay more, making more homes unaffordable. In the week ending December 29, the 30-year fixed mortgage rate averaged 6.42 percent.

According to the report, “As interest rates continue to climb, and housing sentiment decreases, many potential homebuyers continue to wonder whether they’ll ever be able to purchase a home,”

However, it also contains good news. For the second consecutive month in December, 57% of cities made homebuying more affordable. As a result, the 30% rule may soon apply to more cities.

The following statistics were used in the calculation of the index:

• projected median household income
• based on data from RealtyHop, median prices for homes for sale
• local property taxes using census data from the American Community Service
• expenses associated with a mortgage, assuming a 30-year loan, a 5.5% interest rate, and a 20% down payment

The most expensive housing market in the United States was Miami, Florida, where the median asking price for a home increased by 0.50 percent to $598,000.

A family with a household income of $44,581 in Florida would have to spend 85.67 percent of their income on housing, according to RealtyHop.

The five US housing markets with the lowest prices

• Miami, Florida
• Los Angeles, California
• New York, New York
• Newark, New Jersey
• Hialeah, Florida

Los Angeles, California came in second on the list. Despite a $1,000 decrease in the median home purchase price, California remains the second least affordable city for the sixth month in a row.

With an average salary of $69,695, someone can expect to spend 83.06 percent of their income on housing expenses like mortgage payments and taxes, according to RealtyHop.

With a 1.93 percent increase in the median purchase price, New York City is the third least affordable city in the United States. Housing will take up 78.97% of a resident’s income, or $4,483.45 per month, for a salary of $68,129 on average.

According to RealtyHop, the average price of a home in New York City is still lower than it was this summer when homeowners spent 84.61 percent of their income on housing.

The Least Affordable Housing Markets

Starting with the most expensive, here are the five housing markets in December with the lowest affordability.

1. Miami: Share of average household income ($44,581) that should be paid for home ownership: 85.67%. According to the report, the median asking price for the city increased by 0.5 percent in December from November, reaching $598,000.

2. Los Angeles: Part of the cost of owning a home out of the average household income (69,695): 83.06%. The situation is getting better here. The median home purchase price fell by $1,000 to $949,000.

3. New York City: Share of the average household income of 68,129 dollars that must be paid for home ownership: 78.97%. Here as well, the trend is positive. During the summer, the share decreased from 84.61 percent.

4. Newark, N.J.: Share of average household income of $38,854 that must be paid for home ownership: 75%. Also, good news here: in December, the median housing price decreased by 1.97 percent to $372,500.

5. Hialeah, Fla: Share of average household income ($40,036) that must be paid for home ownership: 71.76%. Here, things are quickly getting worse. The median home price increased by 2.43 percent to $449,000.

The Most Affordable Housing Markets

These are, in order, the five most affordable housing markets, beginning with the very most.

1. Wichita, Kan.: Share of average household income ($59,861) that must be paid for home ownership: 16.36%. As the median asking price for a home decreased from $149,900 in November to $145,000 in December, Wichita became even more affordable.

2. Fort Wayne, Ind.: Share of average household income ($57,533) that must be paid for home ownership: 18.3%. The median home price decreased by 2.88 percent to $165,000 in December, making it even more affordable.

3. Detroit: Share of average household income ($34,932) that must be paid for home ownership: 19.03%. With home prices dropping by 4.76 percent to $90,000, things are also getting better here.

4. Cleveland: Share of average household income ($35,305) that must be paid for home ownership: 22.96%. The trend is also positive here as well. From November, home prices fell by 3.36 percent in December to $115,000.

5. Lubbock, Texas: Share of average household income ($57,685) that must be paid for home ownership: 23.26%. Home prices here were unchanged at $185,000.