In a market full of challenges over the last few years, home prices have been a strong thorn in the side of homebuyers. Since 2019 home prices have grown exponentially, from $313,000 in Q1 2019 to $436,800 in Q1 2023. While this hurdle looms over the housing market, where can homebuyers look to find affordable homes?
Wallethub’s new study compared 300 U.S. cities across ten key metrics—ranging from the costs of homes and their maintenance to tax rates and vacancy rates—to find the most affordable cities for homebuyers in 2023.
The top ten cities:
- Montgomery, Alabama
- Flint, Michigan
- Toledo, Ohio
- Detroit, Michigan
- Akron, Ohio
- Warren, Michigan
- Pittsburgh, Pennsylvania
- Yuma, Arizona
- Springfield, Illinois
- Palm Bay, Florida
Key highlights:
- Springfield, Illinois, has the most affordable housing (median house price divided by median annual household income), 1.67, which is 17.5 times cheaper than in Santa Barbara, California, the city with the least affordable housing, with a ratio of 29.24.
- Honolulu has the lowest median real-estate tax rate, 0.3%, which is 12 times lower than in Waterbury, Connecticut, the city with the highest at 3.59%.
- Flint, Michigan, has the highest rent-to-price ratio, 26.64%, which is 16 times higher than in Santa Monica, California, the city with the lowest at 1.66%.
- Miami Gardens, Florida, has the highest median home price appreciation, 94.61 percent, which is 59.1 times higher than in Hampton, Virginia, the city with the lowest at 1.6%.
- Miami Beach, Florida, has the highest vacancy rate, 35.24%, which is 17.4 times higher than in South Gate, California, the city with the lowest at 2.02%.
Major takeaway:
When asked what should home buyers consider when choosing a city to settle down in, experts commented the following:
“Try to predict how long you will be in that particular city. Will this be a shorter or a longer stay? In the case of the latter, will there be life changes along the way, for example, an alternative career or retirement? If so, amenities may be valued differently. For example, busy professionals may appreciate access to public transportation (such as Amtrak) or an airport which will help them attend conferences. On the other hand, retirees may appreciate access to community centers, libraries, or universities to take classes or mingle with other community members.” —Katrin B. Anacker, Professor, George Mason University
“Short of being retired, the city you live in will probably be driven by your job opportunities or job offer, unless you are one of the increasing numbers that has made a business out of online or remote work/consulting. So, this is a pretty broad question. That said, you should be looking at the cost of housing, crime rates, school system, cost of living in general for the area, and other basics. And…ask yourself is this the sort of community you want to live in?” —James Refalo, Professor, California State University, Los Angeles
For the full report, click here.
