Zillow Reveals 10 Cities Where Your Dream Home Is Still Affordable
We've all seen the memes about never being able to afford a home, and the best jokes always have a hint of truth to them. Buying property is becoming rarer for younger generations, especially for first-time home buyers. Renting is seen as more cost effective and easier to manage as housing markets become increasingly difficult to navigate and down payments take longer to save for (8 years on average). However, there are still plenty of major cities where buying a home as a first-time buyer is attainable, according to Zillow's Trend Expert Amanda Pendleton. "Aspiring home buyers who have location flexibility are seeking out affordability," she explains. "They’re looking for vibrant cities with good job prospects where they can afford to put down roots. Many of these metros offer a high quality of life at a lower cost and that’s really appealing right now."
While costs continue to rise in coastal cities, potential home buyers are instead looking to the Midwest to fulfill their home owning dreams. Pendleton explains, "The most affordable metro areas are primarily in the Midwest and Great Lakes region. It’s no coincidence these are also some of the hottest housing markets in the country right now." Cities like Cincinnati, Ohio, St. Louis, Missouri, and even Chicago, are being flooded with those looking to finally settle down and buy instead of signing yet another lease. Below, we highlight the 10 most affordable housing markets right now for potential home buyers.
But what makes these areas affordable? Pendleton says that these 10 housing markets all offer median home prices that require a monthly mortgage payment that takes up less than 30 percent of the area's average annual income. These housing markets can offer a cost of living that is lower than other parts of the country like New York or Los Angeles where the average resident spends over 50 percent of their annual income on their home. Read on for more info on what is drawing home buyers to these 10 markets.
Pittsburg, Pennsylvania
Typical home value: $201,600
Known as the "Steel City" thanks to its 446 bridges (the city is surrounded by rivers), Pittsburgh is great for those looking for city life without the need to pack their entire lives into an apartment. With an average mortgage of $1,160 per month, Pittsburgh has the lowest homeowner burden requiring only 25.4 percent of their income.
Cleveland, Ohio
Typical home value: $211,500
Located at the northern tip of Ohio, Cleveland is home to the Rock and Roll Hall of Fame. And the city "rocks" in more ways than one, as the homeowner burden lies just above 27 percent of the average annual income of $65,000—meaning mortgages are most commonly in the $1,200 ballpark.
St. Louis, Missouri
Typical home value: $237,800
Home of fiercely loyal sports fans and a thriving blues music scene, St. Louis is a city for the passionate. Here, with a median household income of $72,000 per year, your home payments (around $1,369 per month) will only take up 27.8 percent of that valuable spending on average.
Detroit, Michigan
Typical home value: $235,500
Detroit is on the up and up thanks to its booming automobile industry and music scene. Here, incomes average out at $70,000 per year and mortgages require just above 28 percent with the average homeowner spending $1,355 monthly.
Louisville, Kentucky
Typical home value: $243,500
Home of the Kentucky Derby, Louisville is the state's largest city. This is a great place for budding families, and the average homeowner burden is just 29.2 percent—mortgages average $1,402 and the median annual income is $70,000.
Rochester, New York
Typical home value: $228,400
If you're not one to shy away from colder weather, Rochester might be the city for you. It has been known as both "the Flour City" and "the Flower City" for its dual role in flour production and floriculture, and it's also where Kodak got its start. With an average annual income of $66,000, homeowners can expect an average monthly mortgage payment of $1,315 or a burden of 29.3 percent.
Oklahoma City, Oklahoma
Typical home value: $224,200
With a surprising musical theater scene, Oklahoma City is a great city for those looking for a strong arts environment. When buying a home here you can expect an average mortgage of $1,290 which equates to a 29.4 percent of the average $64,000 annual income.
Chicago, Illinois
Typical home value: $300,500
Chicago is rarely on a list of the most affordable cities to buy a home in, but with a variety of neighborhoods to search, the market will surprise you. Head to the Windy City for an average mortgage payment of $1,730 per month. The city has an average income of $83,000, so this mortgage equates to a household burden of 30.4 percent.
Indianapolis, Indiana
Typical home value: $265,300
Indianapolis is a great city for young professionals and racing fans alike. The city boasts an average annual income of $73,000 and a household burden of 30.4 percent due to an average monthly mortgage of $1,527.
Cincinatti, Ohio
Typical home value: $267,200
In terms of this list, the least affordable city for home buyers right now is Cincinnati, Ohio—but you'll still find a great deal. This vibrant metro is the perfect blend of city and suburban life. While most residents rent, you can buy a home for an average monthly mortgage of $1,538 which equates to a homeowner burden of 30.4 percent of the average annual income of $74,000.
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