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Home Affordability Watch: Price Tags in Midsize Metros

Nov. 25, 2018
Home Affordability, Mortgages
The most and least affordable places to buy a home
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Big coastal cities have some of the highest house prices in the country. In comparison, medium-size cities are often relative bargains. But not always.

Each quarter, NerdWallet calculates home affordability for 172 metropolitan areas for which the National Association of Realtors publishes home prices. NerdWallet narrowed its focus this quarter to the medium-size metros — those with populations between 250,000 and 1 million.

The resulting 87 metro areas range in size from Yakima, Washington, with a population of 250,193, to Tulsa, Oklahoma, with 990,706. Other metro areas in this size range include Spokane, Washington; Albuquerque, New Mexico; Omaha, Nebraska; and Toledo, Ohio.

Affordability was calculated by comparing median household incomes and median home prices. An area with high incomes and low home prices is more affordable for buying a home than an area with low incomes and high home prices.

Here are the five most affordable and five least affordable medium-size metro areas in the third quarter of 2018. The rankings were compiled using data from the National Association of Realtors, the U.S. Census Bureau and NerdWallet surveys. Even medium-size cities can boast a touch of Hollywood, so we’ve mentioned movies and TV shows that were filmed or set in each of these.

» MORE: How much home can you afford in your area?

Most affordable medium-size metro areas in Q3

1. Youngstown-Warren-Boardman, Ohio-Pennsylvania

Median home price: $97,600 (national median price: $266,900)

Median household income: $45,382

Principal and interest payment: $407 (10.8% of median monthly income)

Population: 541,926

Youngstown’s metro area was the least expensive housing market among the 172 metro areas for which the National Association of Realtors collects house price data. Low house prices make Youngstown affordable, even though the typical household income is well below the national median of $60,336. Youngstown is roughly midway between Cleveland and Pittsburgh. The city was the filming location for portions of the 1978 movie “The Deer Hunter,” which won the Oscar for Best Picture.

2. Peoria, Illinois

Median home price: $131,300

Median household income: $57,453

Principal and interest payment: $547 (11.4% of monthly income)

Population: 372,427

Roughly halfway between Chicago and St. Louis, this city on the Illinois River had the highest median household income among the five most affordable metro areas on this list. Parts of the 1986 Richard Pryor movie “Jo Jo Dancer, Your Life Is Calling” were filmed in Peoria.

3. Rockford, Illinois

Median home price: $131,600

Median household income: $55,484

Principal and interest payment: $549 (11.9% of monthly income)

Population: 338,291

This city about 90 miles west of Chicago was home to the Rockford Peaches, a women’s professional baseball team in the 1940s and 1950s that was fictionalized in the 1992 movie “A League of Their Own.”

4. Erie, Pennsylvania

Median home price: $123,200

Median household income: $50,614

Principal and interest payment: $514 (12.2% of monthly income)

Population: 274,541

Erie lies on the shore of Lake Erie, about halfway between Buffalo, New York, and Cleveland, Ohio. Portions of the bleak 2009 movie “The Road” were filmed in Presque Isle State Park, just offshore from downtown.

5. Davenport-Moline-Rock Island, Iowa-Illinois

Median home price: $133,900

Median household income: $54,173

Principal and interest payment: $558 (12.4% of monthly income)

Population: 382,263

Known as the Quad Cities, this metro area straddles the Mississippi River, about 175 miles west of Chicago. The 1991 biopic “Bix,” about Davenport native and jazz cornetist Bix Beiderbecke, was filmed partly in the Quad Cities. (The Census designation omits the name of the fourth city: Bettendorf, Iowa.)

Least affordable medium-size metro areas in Q3

1. Honolulu, Hawaii

Median home price: $818,600

Median household income: $81,284

Principal and interest payment: $3,412 (50.4% of monthly income)

Population: 988,650

The typical household in Honolulu has a high income compared to the national median, but house prices are sky-high, too, with the median house price more than 10 times the median household income. Parts of the 2004-2010 TV series “Lost” were recorded in Honolulu.

2. Boulder, Colorado

Median home price: $604,200

Median household income: $80,834

Principal and interest payment: $2,519 (37.4% of monthly income)

Population: 322,514

Nestled in the foothills of the Rocky Mountains, about 25 miles northwest of Denver, Boulder is home to the University of Colorado. In the 1980 horror classic “The Shining,” the exterior of the Torrance family’s apartment was filmed in Boulder.

3. Naples-Immokalee-Marco Island, Florida

Median home price: $425,000

Median household income: $66,048

Principal and interest payment: $1,772 (32.2% of monthly income)

Population: 372,880

This touristy area on Florida’s southwest coast is known for its white-sand beaches and fishing in the Ten Thousand Islands. Part of the 1997 comedy “Gone Fishin,’” starring Danny Glover and Joe Pesci, was filmed on Marco Island.

4. Reno, Nevada

Median home price: $385,800

Median household income: $61,360

Principal and interest payment: $1,608 (31.5% of monthly income)

Population: 464,593

Reno, about 50 miles northeast of Lake Tahoe, calls itself “The Biggest Little City in the World.” And it has big-city housing prices, dealing it a bad hand on the affordability scale. A lot of “Sister Act,” the 1992 Whoopi Goldberg comedy, was filmed in Reno.

5. Eugene, Oregon

Median home price: $302,700

Median household income: $50,654

Principal and interest payment: $1,262 (29.9% of monthly income)

Population: 374,748

Eugene, located in the Willamette Valley between the Pacific Ocean and the Cascades, has the lowest median household income among the five least affordable medium-size metro areas. It is home to the University of Oregon, where much of the 1978 comedy “Animal House” was filmed.

How NerdWallet crunched the data

Affordability was estimated by comparing each metro area’s median annual household income with the monthly principal-and-interest payment for a median-priced single-family home in the third quarter. (Median means half the incomes and prices are higher and half are lower.) After a 20% down payment, house payments were calculated at an interest rate of 4.74%, the average rate for a 30-year fixed-rate mortgage in the third quarter in NerdWallet’s daily mortgage rates survey. Payments exclude insurance and property taxes.

Metro-area median household income is from the U.S. Census American Community Survey of 2017. Metro area populations are from the Census estimates for 2017, the latest available. Median prices for resales of existing single-family homes in the third quarter came from the National Association of Realtors.

A version of this article was originally published by The Associated Press.

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