A family in Detroit, Michigan, can afford an average-priced home by earning just $26,690 annually, making it the most affordable metro in the nation, according to a new report from Redfin.
Also included on the report’s list of most-affordable metros were New York markets Buffalo and Rochester; Dayton, Ohio; and Pittsburgh, Pennsylvania.
Prospective homebuyers in Buffalo needed to earn $31,785 to afford a median-priced home in that market, Rochester homebuyers needed an annual salary of $30,289, and Dayton required an annual income of just $28,980. A salary of $33,655 is needed to purchase an average-priced home in Pittsburgh.
On the other side of the spectrum, California was home to seven of the top-10 least-affordable metros in the nation: San Francisco, Anaheim, San Jose, Los Angeles, San Diego, Oakland, and Oxnard.
San Francisco had both the highest-necessary income and the highest median-sales price of the 88 markets surveyed. Prospective homebuyers in the Bay Area would need to earn $265,499 annually to afford the average-priced home of $1.42 million.
“People who live in places like Detroit, Pittsburgh, and Cleveland tend to earn lower salaries than people in expensive coastal areas, but in many ways the midwesterners’ quality of life is better. Even though they may make less money, it’s easier to purchase a home and build equity while providing for a family,” said Redfin Chief Economist Daryl Fairweather. “It’s no secret there’s an affordability crisis in high-priced places like the Bay Area, where modest homes can sell for well over $1 million.
“But in most of the country, homes are still affordable on the typical local income. That’s one reason people are looking to move to places like Phoenix, Atlanta, and Las Vegas, where homes are affordable on realistic incomes.”
Just outside the 10 least-affordable markets was Nassau County, New York, where 124% of the median-household income is needed to afford an average-priced home, along with Sacramento and Riverside, California, where it required 121% and 120%, respectively, of household income to afford a home.