Top 6 Most Expensive Cities for Homeownership
While the dream of homeownership has become more difficult in many cities due to rising home prices and ever increasing amounts of student debt, there are some cities where house prices require a six figure salary in order to purchase a home.
In its recently released Home Price Insights report, real estate and data analytics provider CoreLogic found that home prices rose both year over year and month over month. According to the data, home prices climbed 3.5 percent nationally from October 2018 to October 2019. Every state in the country posted a price increase when it comes to home prices.
In six major metropolitan areas, home prices have hit a level that prices most people out of the market unless they are one of the highest earners in the area. The report used the latest quarterly home-price information from the National Association of Realtors and also took into account local property tax and homeowners insurance costs in order to calculate the income needed to qualify for a median-priced home in each market.
The Six Most Expensive Metro Areas in the U.S.
Let’s have a quick look at the top six metro areas where if your salary is not over six-figures, you probably can’t afford a home.
San Jose, California
In the number one spot is San Jose, California, otherwise known as Silicon Valley. If you want to call San Jose home, you will need to bring home at least $228,998 in order to afford a median priced home which comes in at a mind blowing $1.24 million. If you qualify for a 30-year mortgage with a 4.03% interest rate your monthly mortgage bill will come in at $5,343.
San Francisco
Not too far away is the second most expensive city for homes. In San Francisco, the median home price is a whopping $964,000 which means you will need to be pulling down at least $182,486. If you can’t swing a 20 percent down payment, bringing only 10 percent to the table, the salary requirement jumps up to $210,000.
Los Angeles
Yet another California city rounds out the top three. In fact, of the six cities we are looking at, four of them are in California. While still expensive, Los Angeles is definitely more affordable than the top two cities on the list. The median price of a home in L.A. is a somewhat more affordable $649,600.
Despite a significant price drop, you still need to pull down at least $124,080 to be a homeowner in the Los Angeles area. A 10 percent down payment will push the salary requirement up to $143,266.
San Diego
The final California city on the list is San Diego. Despite it being the cheapest Golden State city on the list, you still need an income of $122,645 to be able to afford the median home price of $645,000. Your monthly mortgage payment comes out to $2,862.
Boston
We head to the East Coast now, with Boston ranking number five on the list. The median home price comes in at $507,400 which means you need to bring home a minimum of $103,993. You will need to fork up $2,426 a month on your mortgage payment to be able to afford your dream home in Boston.
New York City
This one seems a bit of surprise, it feels like New York City should rank higher on the list. A sixth-place finish by the Big Apple proves just how unaffordable certain areas of California have become.
In New York your only need to bring home $102,428 to purchase a median priced home in the metro area. Median home prices hit $440,200 which would require a monthly payment of $2,390.
The Final Four
The final four to round out the top 10 include Seattle, Washington, D.C, Denver, and Portland, Oregon. While still fairly pricey, you don’t need a six-figure income in these cities to afford the median home. As an example, in Seattle, you only need to earn $99,282 to be able to afford the median home price of $520,000
After the top ten, California once again moves in to dominate the list. According to report,
California is home to a whopping 91of the 125 most expensive zip codes in the country.
To can also review the average home insurance rates per state to help you get a good idea on how much homeowners insurance will cost in your area.