The Easiest Place to Buy a Home in America
A recent analysis reveals that Detroit offers the best home affordability in the United States, based on average home price, cost of living, disposable income, and other factors.
Home prices are up sharply since before the COVID-19 pandemic. Realtor.com puts the current average price of a home on the market at $442,500. Tight inventory is the primary reason. One trigger of that is people do not want to sell homes on which they have a 3% mortgage when the interest rate on a 3-year fixed mortgage is almost 7% today.
A new study on home affordability shows the best place to buy a home based on that measure is Detroit. Badeloft USA did the study and used average home prices, monthly net salary, cost of living, and disposable income to determine “years to collect the house price.” Detroit’s number was 2.6. The authors of the study commented, “Markets with lower living costs give residents more room to save, while high-income areas see strong salaries balancing out steeper housing prices.”
Following Detroit were El Paso (5.3), Indianapolis (5.4), Oklahoma City (6.4), and Philadelphia (6.7).
Detroit may make the list because it is among America’s poorest cities. According to the Census Bureau, the city’s poverty rate is 31.2%. Median household income is $39,575, which is about half the nationwide figure. And the median value of occupied residences is $75,800, a modest fraction of the national figure.
One reason Detroit’s figures are so low is that its population in 1970 was 1,511,482, but in 2023 that number was 633,218.
Detroit’s home affordability is low for many of the wrong reasons.
If you’re tired of renting and want to finally buy a home, these may be your best options.
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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.
A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.
