To better understand the financial barriers facing homebuyers across the United States, RealtyHop analyzed the years needed to save for a down payment in the 100 most populous US cities.
The real estate company points out that home prices have increased throughout the country, making homes unaffordable in major cities. Despite recent signs of cooling thanks to the Federal Reserve’s policy on interest rates, more and more households, especially low- and middle-income ones, are struggling to find funds to meet the 20% requirement. initial payment.
Key analysis results:
· Los Angeles is the city with the worst barrier to homeownership. It takes the average family in Los Angeles 15.74 years to save sufficient funds and qualify for a conventional loan.
· On the other hand, a family of It takes Detroit only 2.25 years to pay a 20% down payment on a housewhich is about four months less than our report last year.
· California outperforms all other stateswith 6 cities in the top 10, including Los Angeles, Irvine, San Diego, Long Beach, Anaheim and Santa Ana.
· The barrier to homeownership is generally lower in the Midwest and South. In Chicago, the third most populous city in the United States, It takes a household 4.73 years to obtain a mortgage with a 20% down payment. This number is 6.23 years younger than the largest city, New York, and 11.01 years younger than Los Angeles.
The 5 cities with the highest barrier to owning a home
1. Los Angeles, California
With a median list price of $1,200,000, Los Angeles ranks as the city with the highest barrier to homeownership. Assuming the average Los Angeles family sets aside 20% of their annual income ($15,249 or $1,271 per month) for a down payment on a home, it will take them 15.74 years of savings to meet the loan requirement.
2. Miami, Florida
Miami remains one of the most unaffordable cities in the country this year. The gap between incomes and home prices has worsened in recent years as out-of-town buyers and investors continued to flock to the city.
The median list price rose to $615,000 last year. For local Miami families earning a median income of $54,858, it will take 11.21 years to accumulate enough cash for a home.
3. New York, New York
Thanks to rising median household income and declining median list price, the barrier to homeownership improved slightly this year in New York City. With a median list price of $839,500 and an income of $76,607, it takes homebuyers, on average, 10.96 years to save 20% of the down payment on a home.
4. Irvine, California
Another California city made the top five this year. Despite having a considerably high median household income of $122,948 compared to other major cities, a typical family in Irvine it still takes more than 10 years to accumulate enough cash to cover the initial payment.
5. Hialeah, Florida
Hialeah rounded out the top five this year as one of the cities with the worst barrier to homeownership. With annual savings of $9,906 per year and an average sales price of $480,000, a It will take the average Hialeah family 9.69 years to qualify for a loan.
The 5 cities with the lowest barrier to owning a home
1. Detroit, Michigan
Detroit remains the city with the lowest barrier to homeownership in 2024. With a median list price of $85,000, it will take a typical Detroit family 2.25 years to save for a down payment if they save 20% of their household income each year.
2. Cleveland, Ohio
Homeownership in Cleveland is still affordable for most. With a median home price of $116,250 and a median household income of $37,271, a typical family of It will take Cleveland 3.12 years to meet the 20% down payment requirement.
3. Kansas City, Missouri
The median household income in Kansas City currently sits at $65,256, considerably higher than other low-barrier cities included in this index. With an average sales price of $229,500 and an annual savings of $13,051, at It will take Kansas City homebuyers 3.52 years to reach the 20% down payment.
4. Milwaukee, Wisconsin
In Milwaukee, it takes families, on average, 3.62 years saving to buy a house. In a city where the median list price is $179,900, buyers can achieve their goal of homeownership relatively quickly.
5. Wichita, Kansas
Wichita tied with Milwaukee in the rankings this year. With a median household income of $60,712 and a median sales price of $220,000, it takes 3.62 years to accumulate enough cash to cover the 20% down payment necessary to purchase a home.
To consult the complete report and its methodology, enter here.
Keep reading:
· Real estate market myths that affect buyers and sellers in the US today
· How did mortgage rates start in 2024?
· Places homebuyers are moving to in the US.
2024-01-16 13:00:00
#years #save #house #Journal
