Point2 Homes recently looked at the 50 most populous cities in North America to determine the affordability ratio for each. Based on the numbers, Memphis is the 7th most affordable housing market in the U.S.
To show the affordability levels across North America, Point2 Homes compared the home price to income ratio (also called median multiple). In other words, the measure determines the number of years that it would take the entire median family income to pay the median household price.
Conclusions:
* With a median multiple of 3.8, Memphis ranks as the 20th most affordable real estate market in North America and the 7th most affordable in the U.S.;
* Looking at the raw numbers, Memphis sports the 3rd lowest median home selling price in the States, less than half that of Nashville, which stands at 5.6 years;
* Memphis also has the 2nd lowest median family income in the country, after Detroit.
With a median home sale price of $1,108,345 and a median family income of $63,944, Vancouver is the most unaffordable market in North America, more so than other expensive housing markets such as Manhattan and San Francisco. Its median multiple currently stands at 17.3, or put another way, it takes 17.3 years for a Vancouver resident to pay the median price of a house.
Although homes in San Francisco and Manhattan are more expensive than those in Vancouver, with median selling prices of $1,275,000 and $1,207,500, respectively, a lower median income is what makes Vancouver’s affordability index higher than that of the two U.S. cities.
According to The New York Times the affordability crisis was fueled by foreign investments in the real estate sector. The median home sale price has escalated way above the median family income, turning Vancouver into one of the least affordable housing markets in the world.
Here’s a selective list of cities with the number of years it would take to pay the median price of a house with the median household income:
15.6 years – Manhattan
12.1 years – Los Angeles
6.7 years – Seattle
6.6 years – Dallas
6.6 years – Portland
4.7 years – San Antonio
3.8 years – Memphis
3.8 years – Oklahoma City
3.3 years – Indianapolis
3.2 years – Jacksonville
1.8 years – Detroit
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The simple truth is that Memphis may be more affordable because nobody wants to live or move here. People are leaving and our population is stagnant. Cities with the higher # of years to pay median price are the most desirable places to live.
Maybe pretty cheap real estate, but high property taxes in Memphis.
And what do we get for those high taxes? Terrible schools, blighted neighborhoods and crime everywhere. People just don’t want to live in Memphis.
I wouldn’t say “nobody” wants to live here. Apparently you still do. Or have you moved yet?
To Planner: Touche!