The topic of affordability is on everyone’s radar these days including Harris Real Estate. Here is this week’s second piece on the topic.

Unison, a home investment company, just released its latest 2018 Home Affordability Report. The Report indicates how much a homeowner would need to spend per year in order to buy a home and live it in a specific city in the US.

For the purposes of this report, Unison included the following elements in its calculations to determine the salary needed to buy a home in specific major cities.   The elements included were

  • median property values in each specific city
  • approximate monthly costs for different sized down payments
  • an assumed 4.625% mortgage rate on a 30-year fixed loan
  • an assumed property tax estimate of 1.25%/year
  • an assumed home insurance cost of 0.4% home valuation.

Unison’s results DID NOT ASSUME that homeowners were spending the recommended 30% of their income on housing costs.

Source: Unison

New York City

Assuming a 10% down payment – $418,482/year

Assuming a 20% down payment – $350,000/year

Median home price – $1.6M

San Francisco

Assuming a 10% down payment – $349,650/year

Assuming a 20% down payment – $292,000/year

Median home price – $1.3M

Los Angeles

Assuming a 10% down payment – $187,306/year

Assuming a 20% down payment – $156,000/year

Median home price – $714,935/year

Seattle

Assuming a 10% down payment – $171,575/year

Assuming a 20% down payment – $143,000/year

Median home price – $654,899

Portland

Assuming a 10% down payment – $107,692/year

Assuming a 20% down payment – $90,000/year

Median home price – $496,328

Denver

Assuming a 10% down payment – $95,360/year

Assuming a 20% down payment – $79,000/year

Median home price – $363,984

Atlanta

Assuming a 10% down payment – $61,847/year

Assuming a 20% down payment – $51,000

Median home price – $236,065

Phoenix

Assuming a 10% down payment – $53,388/year

Assuming a 20% down payment – $44,000/year

Median home price – $203,777

Dallas

Assuming a 10% down payment – $48,887/year

Assuming a 20% down payment – $40,000/year

Median home price – $186,597

Philadelphia

Assuming a 10% down payment – $37,429/year

Assuming a 20% down payment – $31,000/year

Median home price – $142,864

Kansas City

Assuming a 10% down payment – $29,036/year

Assuming a 20% down payment – $24,000/year

Median home price – $110,827