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Median Home Price and Salary Required in 27 Major Cities

  • Written by Syndicated Publisher No Comments Comments
    May 23, 2014

    Tim Manni, the Managing Editor at HSH.com, has a new commentary out entitled “The Salary You Must Earn to Buy a Home in 27 Metros”. The opening tease is a question:

    “How much salary do you need to earn in order to afford the principal and interest payments on a median-priced home in your metro area?”

    The article is a must-read for anyone interested in US real estate trends and income demographics. Here is a slightly edited version of the Tim’s table of the key data. I’ve rounded the dollar amounts to facilitate reading. Note that the data is sorted by the salary needed to finance the median priced home with a standard 28 percent “front-end” debt ratio and a 20 percent down payment:

    How do these metropolitan area real estate costs stack up against each other and the US median household income? Here is a column chart to which I’ve added the latest Sentier Research data for the US median household income as of March 2014.

    Click to View
    Click for a larger image

    The table above includes a column for the percent change from the previous quarter (Q4 2013). Here are the 27 cities sorted by the change. The range of the percent change is quite astonishing.

    I’ll be keeping an eye on this series to see how these trends change over time. I highly recommend a look at Tim Manni’s slide show of the 27 cities with additional details and city-by-city summary.

    For additional research on various income-related topics, here are links to commentaries I regularly update when new data is available.

    Images: Flickr (licence attribution)

    About The Author

    My original dshort.com website was launched in February 2005 using a domain name based on my real name, Doug Short. I’m a formerly retired first wave boomer with a Ph.D. in English from Duke. Now my website has been acquired byAdvisor Perspectives, where I have been appointed the Vice President of Research.

    My first career was a faculty position at North Carolina State University, where I achieved the rank of Full Professor in 1983. During the early ’80s I got hooked on academic uses of microcomputers for research and instruction. In 1983, I co-directed the Sixth International Conference on Computers and the Humanities. An IBM executive who attended the conference made me a job offer I couldn’t refuse.

    Thus began my new career as a Higher Education Consultant for IBM — an ambassador for Information Technology to major universities around the country. After 12 years with Big Blue, I grew tired of the constant travel and left for a series of IT management positions in the Research Triangle area of North Carolina. I concluded my IT career managing the group responsible for email and research databases at GlaxoSmithKline until my retirement in 2006.

    Contrary to what many visitors assume based on my last name, I’m not a bearish short seller. It’s true that some of my content has been a bit pessimistic in recent years. But I believe this is a result of economic realities and not a personal bias. For the record, my efforts to educate others about bear markets date from November 2007, as this Motley Fool article attests.

     
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