Personal finance

Moving? Here’s how much you need to earn to afford a house

For those who can afford it, the coronavirus crisis has caused a home-buying frenzy.

In the last year, 1 in 20 adults moved, either permanently or temporarily, from where they were living due to the Covid outbreak, according to a recent report by the Pew Research Center.

Not everyone is heading from the city to the suburbs, however. In the New York metro area, for example, 3 of the 5 most popular places to relocate to from Manhattan were less than 15 miles away, according to a separate analysis of data from the U.S. Postal Service by Bankrate.com.

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Almost regardless of location, prices are rising in face of skyrocketing demand.

That, in turn, has fueled an affordability problem for many would-be buyers, despite mortgage rates near the lowest levels ever.

Here’s a look at how much you need to earn now to afford a home in the country’s most popular cities, according to a new analysis by Zippia.com.

For most people on the move, hot spots like San Francisco and New York remain well out of reach. On the flipside, Detroit and Akron or Toledo, Ohio are relatively affordable.

The career-planning site determined monthly mortgage payments by taking the average home cost with a 30-year mortgage and a 3.9% interest rate (not including taxes, insurance and other costs). Zippia also applied the standard rule that your monthly mortgage payments should be less than 30% of your monthly income.

In the end, of the 175 cities in the report, there are only 51 where the amount needed for home ownership is below the median income in that location. (Here’s a look at Zippia’s full list.)

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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.

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