Want to buy a home in the Miami area, priced midrange in the market? You’d better have a well-paying job because Miami was ranked as the 11th least affordable city in the country.
A salary of $71,644.01 would be necessary to purchase a median-priced $335,000 house in South Florida, according to the latest analysis of 50 metro areas by HSH, the publisher of mortgage and consumer loan information.
San Jose, capital of Silicon Valley and grappling with a housing crisis, was most expensive with a salary of $221,363.63 needed to buy a $1.18 million home. Three other California cities followed in order: In San Francisco, it takes $181,341.49 in annual pay to afford a $950,000 home; in San Diego, those numbers are $116,875.11 and $605,000, respectively, and in Los Angeles, you’ve got to earn $101,531.66 to buy a $514,200 house.
Want value in a lovely city with a high quality of life? Try Pittsburgh, where a $35,329 salary would get you a $145,000 home. Memphis, Louisville, Cleveland, Oklahoma City and Indianapolis all required salaries under $40,000 to buy mid-priced homes. In Atlanta, $43,893.29 would be adequate to buy a $204,900 home.
The prices included the cost of principal, interest, taxes and insurance and assumed a 20 percent down payment and a 4.11 percent 30-year fixed mortgage rate. The national average was $56,159 in salary needed for a $255,600 home.
"Prices are rising quickly for two reasons: Plenty of demand and limited supply," wrote the authors of the study. "On a year-to-year basis, the median increase in salary needed to keep pace with rising costs was 9.3 percent."
Miami was defined as including Fort Lauderdale and West Palm Beach. Other metro areas ranked among the 25 most expensive were New York, Boston, Seattle and Washington, D.C.
Three other Florida cities ranked among the 25 least expensive, markedly lower than Miami. In Orlando, a salary of $54,158.84 is needed to purchase a median-priced $245,000 home; in Jacksonville, you’d have to earn $51,564 to afford a $232,500 home, and in Tampa, it takes $49,123.91 in annual pay to buy a $220,200 home.
"The glaring need for more new home construction is creating an affordability crisis that needs to be addressed by policy officials and local governments," said Lawrence Yun, chief economist for the National Association of Realtors. "An increasing share of would-be buyers are being priced out of the market and are unable to experience the wealth-building benefits of home ownership."
The average salary in Miami is $52,677, according to PayScale.com. The median household income in Miami-Dade County is $44,937, according to the county’s housing department.