- In 74% of the US counties analysed, median home prices were not affordable for average wage earners.
- Median-priced homes in Los Angeles, California; Chicago, Illinois; Phoenix, Arizona; San Diego County, California; and Orange County, California were not affordable for the average wage worker.
- Average wage workers could still afford median-priced homes in Houston, Texas; Detroit, Michigan; Philadelphia County, Pennsylvania; Cleveland, Ohio; and Columbus, Ohio.
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According to a 2019 US Home Affordability Report by ATTOM Data Solutions, a majority of median-priced homes are still not affordable to workers making the average wage in each area of the country that was analysed.
In 353 of 480 US counties analysed in the report (74%), workers making the average income could not afford to make monthly house payments on a median-priced home in their area.
The study determined whether or not workers earning the average wage could afford a median-priced home by comparing the average weekly annualized salary in each county with the monthly expenses associated with median-priced homes in each area. Mortgage payments, property taxes, insurance, plus an assumed 3% down payment and a 28% maximum “front-end” debt-to-income ratio resulted in the final cost to own a mid-priced home.
Research showed that 67% of markets require workers to turn over more than 30% of their annualized weekly wages in order to buy a home. Housing markets still favour sellers, as the study revealed that a majority of median-priced homes are less affordable than historic averages.
The counties where median-priced homes were not considered affordable for average wage earners included Los Angeles County, California; Cook County (Chicago), Illinois; Maricopa County (Phoenix), Arizona; San Diego County, California; and Orange County, California.
However, things seem to be looking up for average age earners looking to buy a home. In the 480 US counties analysed in the study, 82% of markets were considered more affordable to the average wage worker than they were a year ago. The study found that ave rage wage workers could still afford median-priced homes in Harris County (Houston), Texas; Wayne County (Detroit), Michigan; Philadelphia County, Pennsylvania; Cuyahoga County (Cleveland), Ohio; and Franklin County (Columbus), Ohio.
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