The Nation’s Most Affordable and Least Affordable Home Markets

The American Dream of home ownership is fading fast, particularly with the rebound of home prices across the nation. Only 63.5% of U.S. households own their own homes, which is down substantially from the 69% of U.S. households who owned their home in 2004, according the Pew Research Center.

What’s more, a Pew Research analysis of U.S. Census and mortgage data found the decline in home ownership since 2004 has been more pronounced among households headed by young adults, blacks and others in the lower income group. 

Nonetheless, Pew Research also reporter that most renters say they would like to own a home in the future but financial obstacles and other constraints such as higher lending standards are making it more challenging to secure a mortgage.

According to HSH.com, a publisher of mortgage and consumer loan information, to buy a home at the median price of $240,900 in the U.S., a person would have to make at minimum a $51,985 annual wage to afford a monthly payment of $1,213 based on a 30-year fixed rate mortgage at 3.57% with 20% down payment.

However, HSH’s research found six major metro areas where consumers can get a buy a home with a monthly mortgage payment of well under $1,000 a month. Moreover, there are two additional metro areas where consumers can buy a home with a monthly mortgage payment for just a few bucks over $1,000.

HSH’s research also shows there are three metro areas where you have to be making at least $100,000 or more to afford a home and three other cities where you have to earn more than $80,000 annually. Below is a list of the eight most affordable home markets and the eight least affordable home markets in the U.S., according to HSH.com.

The Most Affordable Metro Areas:

1. Pittsburgh: In the Steel City where the median home price is $140,000, you have to be earning $31,962 to make a monthly payment of $745 on a 3.49%, 30-year fixed rate mortgage and 20% down payment.
2. Cleveland: Perched on America’s North Coast overlooking Lake Erie, the median price for a home is $138,900 in C-Town. To afford a monthly payment of $797, you have to earn about $34,184 to pay back a 30-year fixed rate mortgage at 3.58% and 20% down payment.
3. Cincinnati: In the Queen City where the median home price is $157,000, you need to be making $36,117 to make a monthly payment of $842 on a 3.63%, 30-year fixed rate mortgage and 20% down payment.
4. St Louis: At the River City, the median home price is $170,000. To afford a monthly payment of $875, your annual salary should be $37,526 to pay back a 30-year fixed rate mortgage at 3.53% and 20% down payment.
5. Detroit: The median price for a home in Motown is $170,817. You have to earn an annual wage of $39,033 to afford a monthly payment of $910 on a 30-year fixed rate mortgage at 3.61% and 20% down payment.
6. Atlanta: In the Empire City of the South, the median home price is $191,500. To afford a monthly payment of $918, you have to earn about $39,384 a year for a 30-year fixed rate mortgage at 3.54% and 20% down payment.
7. Phoenix:  In the Valley of the Sun, the median home price is $235,300. You have to be making $44,129 a year to afford a monthly payment of $1,029 on a 30-year fixed rate mortgage at 3.56% and 20% down payment.
8. Tampa: The median home price is $205,000 in the Cigar Capital of the World. To afford a monthly payment of $1,047, you have to earn $44,897 a year to afford a 30-year fixed rate mortgage at 3.66% and 20% down payment.

The Least Affordable Metro Areas:

1. San Francisco: You may need to own a gold mine to afford a home in the Golden City where the median home price is $835,400. That means you need to be earning $152,173  a year to make a monthly payment of $3,550 to afford a 30-year fixed rate mortgage at 3.66% and 20% down payment, according to HSH.
2. San Diego: Also known by its proud citizens (including Ron Burgundy of Anchorman movie fame) as America’s Finest City, the median home price goes for $589,300. To afford a monthly payment of $2,535 to repay a 30-year fixed rate mortgage at 3.78% and 20% down payment, you need to earn $108,654 a year.
3. Los Angeles: In La-La Land, you have to make a lot of mula to live there or at least $100,147 a year to make a monthly payment of $2,336 to pay back 30-year fixed rate mortgage at 3.65% with a 20% down payment.
4. Boston: The median home price is $435,400 in Beantown. On a 30-year fixed rate mortgage at 3.50% and 20% down payment, the monthly payment would amount to $2,007.
5. New York City: In the City that Never Sleeps, a monthly mortgage payment would cost $1,994 for a median home price of $397,600. To afford a 30-year fixed rate mortgage at 3.56% and 20% down payment, you would have to earn $85,488 a year.
6. Seattle:  You have to earn $81,773 a year to afford a median priced home of $422,100 in the Emerald City. Based on a 30-year fixed rate mortgage at 3.76% and 20% down payment, your monthly payment would total $1,908.
7. Wash. D.C.:  For a median priced home in our nation’s capital at $393,500, you have to be earning at least $78,460. On a 30-year fixed rate mortgage at 3.52% and 20% down payment, your monthly payment would come to $1,830.
8. Denver: To live in the Mile High City, you need to earn $70,460 a year to afford a median priced home of $386,800. Your monthly payment would be $1,650 on a 30-year fixed rate mortgage at 3.63% and 20% down payment.