This County Has the Most Expensive Homes in America
Mortgage rates have risen recently, and so have home prices. This has begun to cause an affordability squeeze as people look for new places to live, often outside big cities that have been plagued by the COVID-19 pandemic. One way economists look at how much money people can afford to pay for a house is the percentage of a person’s income that goes towards monthly home payments. These costs include mortgage, taxes, and insurance.
Real estate research firm ATTOM Data Solutions recently issued its first-quarter 2021 U.S. Home Affordability Report. In it, analysts based affordability figures for U.S. counties by calculating monthly home ownership expenses “on a median-priced home, assuming an 20 percent down payment and a 28 percent maximum ‘front-end’ debt-to-income ratio.” Income data, based on annualized weekly wages, came from the Bureau of Labor Statistics. The county that required the greatest percentage of wages to buy and own a home was Kings County, which is the Brooklyn borough of New York City, where the figure was 75.7%.
ATTOM looked at 552 counties that had enough data to make accurate calculations. Among the things ATTOM researchers discovered is that median home prices rose 18% across the country to $278,000 in the first quarter, compared to the same period a year ago. Home prices rose at least 10% in two-thirds of the country. Nationwide, monthly expenses homes purchased in the quarter accounted for 23.7% of wages. Here is a look at the cities where home values are rising the fastest.
In Kings County, that figure was three times greater. While ATTOM does not draw a relationship between high-income levels and a high percentage of wages needed to buy and own a home by county, there may be one. Other counties with figures close to Kings County’s are among the most wealthy in the country. These include the California counties of Marin, Santa Cruz, and Monterey, as well as Maui County in Hawaii. Here is a look at the richest counties in every state.
Commenting on the trends, Todd Teta, chief product officer with ATTOM Data Solutions, remarked:
“The past year certainly has been an odd one for the U.S. housing market. Home prices surged at a remarkable pace even as the virus pandemic damaged the U.S. economy, which dropped historical affordability levels. But average workers untarnished by the pandemic were still able to afford the typical home because wages and rock-bottom interest rates worked to their favor in a big way.”
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