Six cities on the U.S. coasts have a 70% or higher percentage of households that can't afford a home, according to a new study out Tuesday.
Personal finance website GOBankingRates used the median home listing price in the 100 largest cities to calculate typical monthly mortgage payments. Using the rule that no more than 30% of income should go toward housing, GOBankingRates calculated the income needed to afford a mortgage and identified Places Where 50% of Americans Can't Afford a Home. Researchers then compared this income to the number of households with income equal to or greater than that amount.
Top Five Cities With the Highest Percentage of Households That Can't Afford a Home
1. San Francisco
Median listing price: $1,199,000
Percentage of households that can't afford a home: 76.7%
2. Boston
Median listing price: $725,000
Percentage of households that can't afford a home: 75.7%
3. Miami
Median listing price: $450,000
Percentage of households that can't afford a home: 74.3%
4. Long Beach, Calif.
Median listing price: $549,900
Percentage of households that can't afford a home: 73.5%
5. Los Angeles
Median listing price: $749,000
Percentage of households that can't afford a home: 72.9%
Additional Study Insights
- Perhaps unsurprising due to its high real estate prices, six of the top 10 cities with the highest percentage of households that can't afford homes are in California.
- Some surprising cities made the final list. In New Orleans, the median home price is $300,000 but 65.4% of households can't afford a home because wages are lower.
- Median home prices in Oakland, Calif., are half as expensive as they are across the bay in San Francisco.
