As a homeowner, you are most likely to adhere to the 28% rule if you find a city where home values are affordable relative to the typical salaries in the area.
To find and highlight these cities, LendEDU analyzed real estate data on over 25,000 American cities. Specifically, we looked at the proportion of houses in each city where the mortgage costs 30% or more of the household income.
Those cities with the lowest percentages of houses with a costly mortgage were recognized by LendEDU as “The Most Budget-Friendly Cities for Homeowners With a Mortgage” and can be found below.
The most budget-friendly cities for homeowners with a mortgage
To see how a city ranked within only its state, either sort the table on the “State” column or type your desired state into the search bar.
To be considered for this ranking, a city had to have a minimum of 7,000 households with a mortgage.
For each city, statistics were gathered on a house-by-house basis.
For example, if a specific house in Newark, New Jersey had a household income of $100,000 and the mortgage payments for the year on that same house totaled $32,000, it was added to the count of houses in Newark where the mortgage costs 30% or more of the household income.
All data found in this report comes from Greatdata.com. LendEDU licensed the dataset provided by Great Data, which derives mainly from the U.S. Census Bureau.
For some data points, like “# of Houses Where Mortgage Costs 30% or More of Household Income” and “Total # of Houses With a Mortgage” the data comes from the most recent U.S. Census Bureau update but Great Data also calculates its own projections based on historical trends to provide the most up-to-date data.
For each city, its total count of houses where the mortgage costs 30% or more of the household income was determined on a house-by-house basis. This means that the mortgage expense on a specific house in a city was compared against the household income for that same exact house in the same city.
Citywide median or average figures for either household income or mortgage expense were not used to determine the totals seen in the report.
To find out the mortgage expense for each house, the U.S. Census Bureau asked respondents the following: “How much is the regular monthly mortgage payment on THIS property? Include payment only on FIRST mortgage or contract to purchase.“
For some cities listed in the report, Great Data provided multiple ZIP Codes within the city, with each ZIP Code having its own data. In these instances, we combined all ZIP Code data for that city to provide a single stat line for each city.
To be considered, a city, or all of its ZIP Codes, had to have a minimum of 7,000 households with a mortgage.
See more of LendEDU’s Research
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