How Long It Takes to Pay Off a Home in the 50 Biggest Metros
The cost of housing in the U.S. has reached excessive levels in recent years, making owning a home unattainable for many people. In New York City and San Francisco, home prices are so high that only the wealthiest among us can afford monthly mortgage payments, let alone purchasing a home in all cash.
For those wishing to buy a home in all cash and foregoing mortgage payments, interest and defaults, it is harder than ever to purchase a home and may take decades to save up the necessary amount.
According to Zillow data, the average price of a single-family home in San Francisco costs $1,440,900 in 2019, while one-bedroom apartments sell for $883,700. Those numbers mean that in order to buy a single-family home in San Francisco, you would need to earn $308,763 per year to keep your mortgage from taking more than 30% of your income.
But, what about saving up for an all-cash payment? A recent study by Property Club explored average home prices in the 50 most populated cities in the U.S. and calculated how long it would take to save up for a single-family home or a one-bedroom apartment.
The study found that in some cities it would take decades to be able to pay for a home in full, while in smaller cities, you could become a homeowner unburdened by mortgage payments in just a few years.
In San Francisco, if you were to save up 30% of the national median income each month to buy a single-family home in full, it would take 81 years to come up with that amount, based on the most recent national wage data from 2017.
In San Jose, you would need to save up for 62 years in order to be able to buy a single-family home, and in Los Angeles you would need to save for 43 years.
For one-bedroom apartments, it would take 56 years to buy one in full in San Francisco, 30 years in Los Angeles, and 24 years in Seattle. In New York City, being able to make an all-cash payment on a one-bedroom would take 14 years.
Cities where housing is closer within reach for more Americans include Cleveland, Oklahoma City, and Wichita, KS, where if you saved up 30% of your income, you’d be able to afford a single-family home in just three years.
Other more affordable areas, according to Property Club, include satellite cities, or smaller cities neighboring large urban center like Aurora, CO, where you can save up and buy a one-bedroom apartment in full in just eight years.
For comments, questions or concerns, please contact David Cohen
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