Michigan City Boasts Lowest Home Price-to-Income Ratio in US
Buying a home isn't the easiest milestone to achieve. Many factors come into play, and not all of them are within the control of the potential buyer.
Still, one of the most important factors in selecting a home can easily be one of the most important factors in the feasibility in buying one in the first place: Location, location, location.
Here in Michigan, the cost of living is below the national average and home prices are fairly reasonable as well at just $253,000, well below the U.S. median of $412,000.
Of course, Michigan is proof of the location factor as some places have unbelievably expensive housing prices while others are shockingly low, and not always for good reason.
The website Voronoi helped contextualize home-buying potential among the nation's largest cities with a study that analyzed the home price-to-income ratio of those cities. Unsurprisingly, Los Angeles had the highest home price-to-income ratio at 12.5. For perspective, the LA median household income is $76,135 compared to the median home price of $953,501.
Detroit, as one of the 54-largest cities in the United States by population, was included in the study and raised eyebrows much like Los Angeles, though for entirely different reasons.
Detroit's home price-to-income ratio is just 1.9 as the median household income in the Motor City is $36,453 while the median home price of just $68,379.
Naturally, this isn't entirely a good thing. Many homes in Detroit are beyond saving and are on the market for laughably low prices. In turn, no household making $36,000 per year is in a position to buy a house, whether they live in Detroit or not.
Nonetheless, it's a difficult balance to achieve. The more money you make, the more houses you can and are willing to buy, especially in a quality location. But it's certainly a difficult proposition to make all of the numbers balance in a satisfactory way.
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Gallery Credit: Crain Homes: Ashley Crain