RealtyHop Housing Affordability Index: July 2019

Posted June 26th, 2019

In this July installment of the RealtyHop Housing Affordability Index, we investigate the decision to purchase a home in the 100 most populous cities across America. Is homeownership affordable or even possible for the average family in each city? Every month we analyze proprietary RealtyHop data alongside comprehensive U.S. Census data to find out. See how your city fares in affordability.

 

The 5 Least Affordable Housing Markets

 

1. Los Angeles, CA saw a 1.44% increase in homeownership burden, as home prices increased to a median price of $899,000. Given this, the average household in LA would need to allocate a staggering 91.4% of total yearly income toward costs of owning a home.

2. Miami, FL was again the second most expensive homeownership market in the country. A 2.2% increase in housing burden meant that the average Miami household would require 87.2% of total annual income to cover mortgage and tax costs.

3. New York, NY was the third most expensive city in the country to own a home this July, with housing prices remaining steady at a median price of $899,900. New York’s homeownership burden was extremely high at 85.3% of total household income.

4. San Francisco, CA saw home prices stay relatively unchanged, leading to a flat homeownership burden of 73.8% compared with last month. As the fourth most expensive city on our list, and the most expensive in the Bay Area, residents should expect to allocate a significant portion of income toward owning a home. In fact, estimated mortgage and taxes for the average property come in at a steep $5,921 per month.

5. Oakland, CA was the fifth most expensive homeownership market, and second most expensive in the Bay Area. The city narrowed its gap between neighboring San Francisco, however, with a 4% increase in homeownership burden over the month. The average household in Oakland would need to allocate 68.1% of total annual income to own a home in the area.

 

The 5 Most Affordable Housing Markets

 

1. Detroit, MI remained the most affordable housing market in the U.S., as median home prices and remained steady in July. A household in the city would only need to spend $302 per month, or 13% of annual income, to own a home.

2. Fort Wayne, IN saw a sharp 6.5% increase in homeownership burden as housing prices increased to a median of $134,900. Despite this, Fort Wayne remains very affordable, requiring only 17% of annual income to own a home.

3. Wichita, KS retained its spot as the third most affordable housing market this July. Median home asking prices did however increase to $145,000. A household in the city should expect to allocate 18.3% of total annual income toward homeownership costs, an increase of 5.5% compared with June.

4. Cleveland, OH remained the fourth most affordable city on our list, despite a 1.9% increase in homeownership burden over the month. Home prices continued to be affordable at a median sales price of $81,000.

5. Indianapolis, IN rounds out our list of the most affordable housing markets this July. The city saw a modest 2.5% increase in homeownership burden, with the average household requiring 21.6% of annual income to be spent toward mortgage and tax costs.

 

Notable Changes This July

 

  • Tulsa, OK increased seven spots on our list to 60th place, as the city saw home prices increase to a median of $215,000. The city’s homeownership burden also jumped 3.61% in the month to 29%.
  • Pittsburgh, PA came in at 49th place on our list, up six spots since last month. With a median home sales price of $224,900, residents should expect to pay an average of $1,178 per month to cover mortgage and taxes. This amounts to 32% of total annual income for the average household.
  • Greensboro, NC increased seven spots on our list to 50th place. The average Greensboro household this month would require to allocate 31.6% of total annual income toward mortgage and housing tax costs.
  • Arlington, TX dropped thirteen spots to 54th place on our list. The city became more affordable as home prices dipped to a median of $229,000. Arlington’s homeownership burden index consequently decreased 5.4% over the month.

 

Methodology

 

The RealtyHop Housing Affordability Index analyzes both proprietary and ACS Census data to provide an index of housing affordability and homeownership burden across the 100 most populous cities in the country. Median home prices are calculated using over 300,000 listings in the RealtyHop database over the month prior to publication.

 

To calculate the index, the following statistics are used:

1) Median household income from the U.S. Census

2) Median for-sale home listing prices via RealtyHop data

3) Local property taxes via ACS Census data

4) Mortgage expenses, assuming a 30 year mortgage, 4.5% interest rate, and 20% down payment.

 

See below for the previous RealtyHop Housing Affordability Indexes:

Full Dataset