The pool of homebuyers that can afford Chicago housing prices is pretty large.
In a Finder.com review of housing and income data from a variety of sources, Chicagoland comes in as a place where people who make a little above an average income can find a home at a reasonable price.
Finder.com compiled data from a variety of sources. They used Census Bureau numbers, data from Zillow, the U.S. Department of Commerce and the Urban Institute.
What they were looking for were a set of benchmarks to gauge how much homes cost in a variety of markets, and how easy it is to pay both mortgage and non-mortgage debt.
Chicago came in at a comfortable 20 out of 78 cities that were rated. The average home value was pegged at $200,300. The analysis found that one could afford to buy a house in Chicagoland with a salary that’s within reach for the middle class– $57,038.
Most of the top 10 entries on the list required low six-figure salaries to afford the average home. The top-ranked city, San Francisco, was found to require a salary of $180,600 to buy an average home.
That’s because an “average” home in the Bay Area costs $1,119,500. Four of the top 10 cities on the list are in California, and nine of the top 10 are located on bodies of water.
The numbers were also crunched to ascertain how much debt the average household had, and how much of their annual income needed to go to other things. Those other expenses included services and goods like healthcare. A non-mortgage debt factor also went into the rankings.
For Chicago, household had non-mortgage expenditures that averaged $31,693 each year, and had $16,483 in non-mortgage debt.
According to U.S. Census Bureau data, the average wage in 2013 was $52,250. That figure makes living in 36 of the 78 cities on the list within reach. Chicago’s required income was above that figure.
Forty-two cities are not affordable at the average income level.
The Finder.com assumed that living comfortably means :
- the ability to purchase an average home, with a 20 percent deposit
- the ability to cover average per-person expenditure
- the ability to pay off non-mortgage related household debt
The housing analysis was based on:
- median house prices in each area
- average 30-year 20 percent home deposit interest rate in the state
- mortgage payments, including interest
- average non-mortgage debt across the city
- average non-housing expenditure across the state.
