By Keith Loria, Contributing Editor
Emeryville, Calif.—ZipRealty, Inc., an online technology-enabled residential real estate brokerage company, released its list of the top 10 most affordable housing markets in 2013 based on a two-year analysis by the company of MLS data and U.S. Census Bureau information.
The formula ZipRealty used compared median home sale prices in 30 metropolitan areas to median household income levels in those same cities. The areas with the lowest ratios of home price to household income were deemed to be the most affordable areas for purposes of the study.
According to the findings, metropolitan areas in Texas and non-coastal regions are the best places to find a real estate bargain with Dallas-Fort Worth, Houston and Minneapolis-St. Paul at the top of the list. On the opposite end of the spectrum, Washington, D.C.; Brooklyn, N.Y.; and the San Francisco Bay Area came in as the most expensive.
“ZipRealty’s analysis shows that in the most affordable areas, the average home sells for about five to six times annual average household income levels,” Lanny Baker, ZipRealty’s CEO and president, says. “However, at the other end of the spectrum, homes in the least affordable metro areas are selling for as much as 11 to 13 times the local household income standards, and in one city we researched, the average house price to income level ratio was almost 17.”
Baker adds that while purchasing a home is a major ticket item for people in any city, ZipRealty’s research made clear that the housing affordability could differ vastly from one city to the next.
“It is important for consumers to understand how housing in their local market tends to be priced relative not only to local income levels, but in comparison to other areas of the nation,” Baker says.
Coming in at number four on the list was Orlando, Fla., followed by Las Vegas; Raleigh, N.C.; Austin, Texas; Denver; Nashville, Tenn.; and Phoenix.