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Report: Hefty wages needed to afford homes


With rising prices and higher mortgage rates, U.S. homes have become more expensive for buyers. Just how expensive?

Now, nearly a third of the U.S. population lives in a county where a homebuyer needs to earn $100,000 or more to afford a median-priced home in their area, according to Attom Data Solutions.

wageaffordHomeowners need at least that amount in 69 counties tracked by the company to afford the market’s midway-priced home. This assumes a 3 percent downpayment  and a mortgage debt load that represents 28 percent of their gross income.

The $100,000 earnings threshold is nowhere near enough salary in several places, however. The five counties that require homebuyers to earn the most are all located in California. These include San Mateo ($377,210 annual income needed); San Francisco ($366,582); Santa Clara ($327,284); Marin ($311,827); and Alameda ($237,760).

The next two highest are the downstate New York counties of Westchester ($228,937) and Kings [Brooklyn], ($221,993).  

Homebuyers also need to make $100,000 or more in other counties in Southern California; Washington, D.C.; Seattle; Boston and Hawaii.

Affordability for buyers continued to deteriorate in the third quarter, Attom said. Home affordability fell to the lowest level since the third quarter of 2008. Average wages earners now can’t afford median prices in 84 percent of the 440 counties analyzed by Attom.

“Rising mortgage rates have pushed home prices to the least-affordable level we’ve seen in 10 years, both nationally and at the local level,” said Daren Blomquist, Attom’s senior vice president. “Close to one-third of the U.S. population now lives in counties where buying a median-priced home requires at least $100,000 in annual income based on our analysis of 440 counties with a combined population of 220 million.”


 

Questions? Contact at (425) 984-6017 or victorw@scotsmanguide.com.

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