Connect with us

United States

Mapped: What You Need to Earn to Own a Home in 50 American Cities

Published

on

Click to view this graphic in a higher-resolution.

A map of the U.S. with the median home price as well as the salary needed to own a home 50 American cities.

What You Need to Earn to Own a Home in 50 American Cities

Once a fundamental part of the American dream, the ability to own a home is drifting farther and farther away for many Americans.

Between skyrocketing prices, stagnating wages, and now rising interest rates, the deck seems to be increasingly stacked against home ownership.

Using May 2023 data tabulated by Home Sweet Home, we map out the annual salary needed to afford a 30-year mortgage (at 6.37%) to buy a home in America’s 50 most populous metropolitan areas.

The monthly minimum mortgage payment includes taxes and insurance as well, and is capped at roughly one-third of the income. This analysis also assumes that the homeowner will put down a 20% down payment.

The Least and Most Affordable American Cities to Own a Home

At the top of the list, and at the very west of the country, San Jose is the least affordable city to own a home for the average American.

One would have to earn at least $374,000 a year to afford a $1.6 million dollar home in the city.

To put those numbers into perspective, the median American annual income is $75,000, about one-fifth what’s required to buy a home in San Jose.

Here’s a look at the annual earnings needed to afford a home in all 50 largest cities in the U.S., ranked from least to most affordable.

RankMetro AreaStateMedian Home PriceAnnual Salary
1San JoseCalifornia$1,618,400$373,696
2San FranciscoCalifornia$1,192,600$282,167
3San DiegoCalifornia$880,000$209,110
4Los AngelesCalifornia$746,800$181,106
5SeattleWashington$699,300$170,340
6BostonMassachusetts$644,400$165,239
7New York CityNew York$577,300$160,233
8DenverColorado$636,100$150,622
9Washington, D.C.N/A$557,200$139,911
10MiamiFlorida$560,000$137,574
11PortlandOregon$556,800$136,147
12Riverside/San
Bernardino
California$550,000$133,607
13AustinTexas$467,900$128,995
14SacramentoCalifornia$500,000$125,304
15Salt Lake CityUtah$522,700$122,717
16ProvidenceRhode Island$417,000$112,281
17OrlandoFlorida$419,900$104,772
18DallasTexas$372,400$103,460
19PhoenixArizona$439,700$103,112
20RaleighNorth Carolina$420,000$102,572
21Las VegasNevada$431,400$101,310
22TampaFlorida$390,000$97,387
23MinneapolisMichigan$361,500$94,466
24HartfordConnecticut$314,900$93,861
25CharlotteNorth Carolina$387,200$93,735
26JacksonvilleFlorida$370,000$93,422
27BaltimoreMaryland$357,800$93,378
28NashvilleTennessee$385,800$93,168
29ChicagoIllinois$321,000$92,868
30HoustonTexas$327,000$91,826
31MilwaukeeWisconsin$339,600$89,752
32AtlantaGeorgia$354,300$89,198
33RichmondVirginia$362,300$88,769
34San AntonioTexas$320,500$88,683
35PhiladelphiaPennsylvania$315,300$87,293
36Virginia BeachVirginia$313,200$79,336
37Kansas CityMissouri$291,000$76,147
38ColumbusOhio$284,700$76,133
39IndianapolisIndiana$289,300$71,409
40New OrleansLouisiana$265,200$68,946
41MemphisTennessee$268,600$68,005
42BirminghamAlabama$276,500$67,773
43CincinnatiOhio$252,200$66,260
44BuffaloNew York$206,800$63,386
45St LouisMissouri$231,100$63,260
46DetroitMichigan$227,000$62,758
47LouisvilleKentucky$246,000$62,741
48Oklahoma CityOklahoma$227,300$62,161
49ClevelandOhio$191,400$55,515
50PittsburghPennsylvania$175,000$50,316
National$371,200$97,204

Other Californian cities, San Francisco (ranked 2nd), San Diego (3rd), and Los Angeles (4th) all require an annual income of at least $180,000 to attempt home ownership within their metropolitan boundaries.

Boston (ranked 6th) and New York (ranked 7th) represent unaffordability on the East Coast, both requiring at least $160,000 a year to buy homes there.

It’s not just the coasts that are expensive however. To buy a home in Denver (ranked 8th) and Salt Lake City (15th) means earning more than $120,000 a year.

However, cities in the Midwest and South, like Pittsburgh, Detroit, Oklahoma City, and Louisville, are far more affordable, requiring less than $63,000 a year to buy a home.

Interest Rates Rock Home Ownership Chances

Aside from the obvious price differences in housing markets, a key factor that has elevated income requirements across the board is the rapid rise in interest rates in the last year. In fact the average 30-year mortgage has pushed past 7%, the highest it’s been since the 2000s.

This means that while the median price of a house in San Jose has actually come down between 2022 and 2023, the minimum monthly payment has increased from $7,717 to $8,720 this year.

RankMetro AreaStateMedian Home PriceMonthly Payment
1San JoseCalifornia$1,618,400$8,720
2San FranciscoCalifornia$1,192,600$6,584
3San DiegoCalifornia$880,000$4,879
4Los AngelesCalifornia$746,800$4,226
5SeattleWashington$699,300$3,975
6BostonMassachusetts$644,400$3,856
7New York CityNew York$577,300$3,739
8DenverColorado$636,100$3,515
9Washington, D.C.N/A$557,200$3,265
10MiamiFlorida$560,000$3,210
11PortlandOregon$556,800$3,177
12Riverside/San
Bernardino
California$550,000$3,118
13AustinTexas$467,900$3,010
14SacramentoCalifornia$500,000$2,924
15Salt Lake CityUtah$522,700$2,863
16ProvidenceRhode Island$417,000$2,620
17OrlandoFlorida$419,900$2,445
18DallasTexas$372,400$2,414
19PhoenixArizona$439,700$2,406
20RaleighNorth Carolina$420,000$2,393
21Las VegasNevada$431,400$2,364
22TampaFlorida$390,000$2,272
23MinneapolisMichigan$361,500$2,204
24HartfordConnecticut$314,900$2,190
25CharlotteNorth Carolina$387,200$2,187
26JacksonvilleFlorida$370,000$2,180
27BaltimoreMaryland$357,800$2,179
28NashvilleTennessee$385,800$2,174
29ChicagoIllinois$321,000$2,167
30HoustonTexas$327,000$2,143
31MilwaukeeWisconsin$339,600$2,094
32AtlantaGeorgia$354,300$2,081
33RichmondVirginia$362,300$2,071
34San AntonioTexas$320,500$2,069
35PhiladelphiaPennsylvania$315,300$2,037
36Virginia BeachVirginia$313,200$1,851
37Kansas CityMissouri$291,000$1,777
38ColumbusOhio$284,700$1,776
39IndianapolisIndiana$289,300$1,666
40New OrleansLouisiana$265,200$1,609
41MemphisTennessee$268,600$1,587
42BirminghamAlabama$276,500$1,581
43CincinnatiOhio$252,200$1,546
44BuffaloNew York$206,800$1,479
45St LouisMissouri$231,100$1,476
46DetroitMichigan$227,000$1,464
47LouisvilleKentucky$246,000$1,464
48Oklahoma CityOklahoma$227,300$1,450
49ClevelandOhio$191,400$1,295
50PittsburghPennsylvania$175,000$1,174
National$371,200$2,268

So to afford a median-priced home in the country, an American needs to earn closer to $100,000 a year, up from $75,500 in 2022. And even then, they would be priced out of owning a home in nearly half of the 50 largest cities in the country.

As a result Americans may yet further delay home ownership. Renting is now a far more attractive option, thanks to the biggest difference between rent and mortgages in over 50 years.

Where Does This Data Come From?

Source: Home Sweet Home (HSH).

Note: HSH used different sources for their median home prices, mortgage rate, property taxes and home insurance figures for their analysis. Please visit their website for more information.

Other: If other personal debts exceed 8% of one’s given monthly gross income, this may increase the salary needed to qualify for a mortgage.

Click for Comments

United States

Visualizing U.S. GDP by Industry in 2023

Services-producing industries account for the majority of U.S. GDP in 2023, followed by other private industries and the government.

Published

on

u.s. gdp by industry

Visualizing U.S. GDP by Industry

The U.S. economy is like a giant machine driven by many different industries, each one akin to an essential cog that moves the whole.

Understanding the breakdown of national gross domestic product (GDP) by industry shows where commercial activity is bustling and how diverse the economy truly is.

The above infographic uses data from the Bureau of Economic Analysis to visualize a breakdown of U.S. GDP by industry in 2023. To show this, we use value added by industry, which reflects the difference between gross output and the cost of intermediate inputs.

The Top 10 U.S. Industries by GDP

As of Q1 2023, the annualized GDP of the U.S. sits at $26.5 trillion.

Of this, 88% or $23.5 trillion comes from private industries. The remaining $3 trillion is government spending at the federal, state, and local levels.

Here’s a look at the largest private industries by economic contribution in the United States:

IndustryAnnualized Nominal GDP
(as of Q1 2023)
% of U.S. GDP
Professional and business services$3.5T13%
Real estate, rental, and leasing$3.3T12%
Manufacturing$2.9T11%
Educational services, health care, and social assistance$2.3T9%
Finance and insurance$2.0T8%
Wholesale trade$1.7T6%
Retail trade$1.5T6%
Information$1.5T6%
Arts, entertainment, recreation, accommodation, and food services$1.2T4%
Construction$1.1T4%
Other private industries$2.6T10%
Total$23.5T88%

Like most other developed nations, the U.S. economy is largely based on services.

Service-based industries, including professional and business services, real estate, finance, and health care, make up the bulk (70%) of U.S. GDP. In comparison, goods-producing industries like agriculture, manufacturing, mining, and construction play a smaller role.

Professional and business services is the largest industry with $3.5 trillion in value added. It comprises establishments providing legal, consulting, design, administration, and other services. This is followed by real estate at $3.3 trillion, which has consistently been an integral part of the economy.

Due to outsourcing and other factors, the manufacturing industry’s share of GDP has been declining for decades, but it still remains a significant part of the economy. Manufacturing of durable goods (metals, machines, computers) accounts for $1.6 trillion in value added, alongside nondurable goods (food, petroleum, chemicals) at $1.3 trillion.

The Government’s Contribution to GDP

Just like private industries, the government’s value added to GDP consists of compensation of employees, taxes collected (less subsidies), and gross operating surplus.

GovernmentAnnualized Nominal GDP
(as of Q1 2023)
% of U.S. GDP
State and Local$2.1T8%
Federal$0.9T4%
Total$3.1T12%

Figures may not add up to the total due to rounding.

State and local government spending, largely focused on the education and public welfare sectors, accounts for the bulk of value added. The Federal contribution to GDP amounts to roughly $948 billion, with 52% of it attributed to national defense.

The Fastest Growing Industries (2022–2032P)

In the next 10 years, services-producing industries are projected to see the fastest growth in output.

The table below shows the five fastest-growing industries in the U.S. from 2022–2032 in terms of total output, based on data from the Bureau of Labor Statistics:

IndustrySectorCompound Annual Rate of Output Growth (2022–2032P)
Software publishersInformation5.2%
Computing infrastructure providers, data processing, and related servicesInformation3.9%
Wireless telecommunications carriers (except satellite)Information3.6%
Home health care servicesHealth care and social assistance3.6%
Oil and gas extractionMining3.5%

Three of the fastest-growing industries are in the information sector, underscoring the growing role of technology and digital infrastructure. Meanwhile, the projected growth of the oil and gas extraction industry highlights the enduring demand for traditional energy sources, despite the energy transition.

Overall, the development of these industries suggests that the U.S. will continue its shift toward a services-oriented economy. But today, it’s also worth noticing how services- and goods-producing industries are increasingly tied together. For example, it’s now common for tech companies to produce devices, and for manufacturers to use software in their operations.

Therefore, the oncoming tide of growth in service-based industries could potentially lift other interconnected sectors of the diverse U.S. economy.

Continue Reading

Subscribe

Popular