NEW YORK–Seeking to purchase a first home? Don’t go west, young man.
New analysis by Bloomberg News of the 100 largest U.S. metropolitan areas to determine the least and most affordable places for people between ages 25 and 44 has identified the best and worst markets for what Bloomberg calls an “affordability gap.” The company said it ranked places by the difference between the median household income for that age group and the estimated minimum earnings needed to purchase a single-family home in the region as of 2015.
There were six locations that registered an affordability gap—where the minimum salary needed to afford the mortgage outstripped actual income. Urban Honolulu took the top spot, with the following five regions all located in California, according to Bloomberg.
The best places for first-time homebuyers are in the Midwest, according to the Bloomberg Housing Affordability Index shows. It reported that in the greater Des Moines, Iowa market, the estimated monthly mortgage is just $613, implying an annual income of just over $22,000 needed to make payments. That compares with the area’s median household income of about $72,200 last year, making it the most affordable for a would-be buyer, Bloomberg said.
Pittsburgh and Baltimore also ranked among the most reasonable, followed by the regions near Minneapolis; Kansas City, Mo.; and Omaha, Neb.—three other Midwestern cities.