The income needed to buy a home in the United States has fallen to just over $115,000, but this goes even lower in some cities.
A new analysis from Redfin found that the income needed to afford a home fell after mortgage rates declined, dropping to 6.5% for the 30-year term in August. The necessary income could drop even further as mortgage rates continue to fall, dipping to 6.08% in the week ending Sept. 26, according to Freddie Mac.
That analysis determined the median household income needed to afford a median-priced home in the area comfortably. A home is deemed affordable if it does not require the homeowner to spend more than 30% of their income on monthly housing costs.
"Housing affordability is improving for the first time in four years, so if you want to buy a home and can afford to, now could be a good time because it's unlikely to become markedly cheaper in the near future," Redfin Senior Economist Elijah de la Campa said.
Where Buyers Need the Least Income To Afford a Home
Detroit, MI
Median Home Sale Price: $200,000
Income Needed to Afford a Median Priced Home: $55,460
Share of Affordable Home Listings: 67.0%
Cleveland, OH
Median Home Sale Price: $235,000
Income Needed to Afford a Median Priced Home: $68,029
Share of Affordable Home Listings: 57.9%
Pittsburgh, PA
Median Home Sale Price: $250,000
Income Needed to Afford a Median Priced Home: $69,813
Share of Affordable Home Listings: 62.2%
READ ALSO: Homebuyers Now Have $200,000 in Additional Spending Power After Mortgage Rates Decline
St. Louis, MO
Median Home Sale Price: $269,900
Income Needed to Afford a Median Priced Home: $74,184
Share of Affordable Home Listings: 59.6%
Cincinnati, OH
Median Home Sale Price: $300,000
Income Needed to Afford a Median Priced Home: $81,924
Share of Affordable Home Listings: 53.0%
Philadelphia, PA
Median Home Sale Price: $300,000
Income Needed to Afford a Median Priced Home: $82,447
Share of Affordable Home Listings: 45.3%
Indianapolis, IN
Median Home Sale Price: $311,623
Income Needed to Afford a Median Priced Home: $89,935
Share of Affordable Home Listings: 50.4%
Warren, MI
Median Home Sale Price: $322,500
Income Needed to Afford a Median Priced Home: $89,561
Share of Affordable Home Listings: 50.2%
Kansas City, MO
Median Home Sale Price: $329,918
Income Needed to Afford a Median Priced Home: $90,652
Share of Affordable Home Listings: 46.4%
San Antonio, TX
Median Home Sale Price: $304,999
Income Needed to Afford a Median Priced Home: $91,926
Share of Affordable Home Listings: 25.6%
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