Americans need to earn nearly $108,000 a year to afford a single-family home in most cities now, according to a new economic report.
Oxford Economics revealed this week that a household in 2024 would need an average annual income of $107,700 to buy a new single-family home, including property taxes and home insurance. This number was double the cost of five years ago in 2019, at only $56,800.
The report added that only 36% of families earned enough to buy a home in the last quarter, a sharp decline from the 59% of families who could afford to buy a home in 2019.
“Housing affordability has declined significantly over the past five years in every major metropolitan area as home prices have risen and mortgage rates have nearly doubled,” the report concluded.
The least expensive cities included San Jose, San Francisco, Los Angeles, San Diego, and Honolulu, where less than 15% of households were able to cover their housing costs. Among the 50 largest cities were the most affordable cities in the Midwest and South, such as Cleveland, Louisville, Detroit, St. Louis, Oklahoma City and Memphis.
Housing costs in those cities ranged from $64,600 to $75,300, with nearly half of the families in these areas earning enough to buy a home.
The most affordable cities from the study were Decatur, Illinois; Cumberland, Maryland; Youngstown, Ohio; Charleston, West Virginia; and Elmira, New York. Nearly two-thirds of households can afford a single-family home in these cities.
Housing costs repeatedly broke records in 2024. In June, findings from Redfin showed that the median home sale price in the United States rose to $394,000, an increase of 4.4% from the same time last year.
In another report from the National Association of Realtors (NAR)'s annual survey of buyers and sellers, it was found that the share of first-time homebuyers fell from 32% in 2023 to 24% in 2024, the lowest percentage since the NAR began collecting data in 1981.
