Home prices have risen in recent years due to a lack of supply in the housing market and elevated mortgage rates.
As of March, the median home sale price in the United States is $420,321, according to Redfin. This marked a 4.8% increase year-over-year. However, in some parts of the country, the price of buying a home is even steeper.
A recent Realtor.com analysis found that, in 14 of the 50 largest metropolitan areas in the U.S., hopeful buyers would need to earn more than $150,000 annually to afford a median home.
"It's desirable places to live, places that haven't built a lot of housing, and major cities that have a lot of higher-paying jobs," Realtor.com Chief Economist Danielle Hale said in the report. "You've either got to be very high-income or come into the market with a lot of equity."
To determine the income required to purchase a home in each city, Realtor.com looked at median home list prices in 50 of the largest metropolitan areas in the U.S. The figures also account for an assumed 20% down payment, local taxes and insurance rates, and a mortgage rate of 6.99%.
10 Cities With the Highest Income Needed to Purchase a Home
1. San Jose, CA
Median Home List Price: $1,467,000
Median Price Change (Year-over-Year): -4.50%
Income Required To Purchase A Home: $361,000
Change in Required Income (Year-over-Year): 1.10%
2. Los Angeles, CA
Median Home List Price: $1,192,000
Median Price Change (Year-over-Year): 8.40%
Income Required To Purchase A Home: $298,000
Change in Required Income (Year-over-Year): 14.70%
3. San Diego, CA
Median Home List Price: $1,050,000
Median Price Change (Year-over-Year): 5.00%
Income Required To Purchase A Home: $259,000
Change in Required Income (Year-over-Year): 11.20%
4. San Francisco, CA
Median Home List Price: $1,027,000
Median Price Change (Year-over-Year): -10.70%
Income Required To Purchase A Home: $256,000
Change in Required Income (Year-over-Year): -5.50%
5. Boston, MA
Median Home List Price: $870,000
Median Price Change (Year-over-Year): 3.70%
Income Required To Purchase A Home: $226,000
Change in Required Income (Year-over-Year)L 9.50%
6. New York, NY
Median Home List Price: $769,000
Median Price Change (Year-over-Year): 9.90%
Income Required To Purchase A Home: $218,000
Change in Required Income (Year-over-Year): 15.50%
7. Seattle, WA
Median Home List Price: $775,000
Median Price Change (Year-over-Year): -6.10%
Income Required To Purchase A Home: $193,000
Change in Required Income (Year-over-Year): -0.60%
8. Denver, CO
Median Home List Price: $625,000
Median Price Change (Year-over-Year): -8,00%
Income Required To Purchase A Home: $165,000
Change in Required Income (Year-over-Year): -2.90%
9. Sacramento, CA
Median Home List Price: $650,000
Median Price Change (Year-over-Year): -1.60%
Income Required To Purchase A Home: $162,000
Change in Required Income (Year-over-Year): 4.20%
10. Washington, DC
Median Home List Price: $625,000
Median Price Change (Year-over-Year): 0.80%
Income Required To Purchase A Home: $159,000
Change in Required Income (Year-over-Year): 6.60%
