In May 2016, both the National Low Income Housing Coalition and Trulia tackled the task to find the perfect salary for renting in Washington, D.C. The former reported that a D.C. resident needs to make $28.04/hour to afford an average-priced two-bedroom apartment, which at the time cost $1,458 per month. Trulia on the other hand reported that D.C. residents should make $77,461 per year in order to afford a median priced apartment, which at the time was $1,975 per month.
Now, HSH.com has come into the ring with a new study that reports what salary is required to buy a home in the District. The number? $81,940.22.
It’s worth noting that, according to HSH.com, the median price for a home in the city is $406,900. Other real estate websites might disagree on this number. According to Redfin, the median home price in Washington, D.C. is currently $554,900. Trulia reports that the median sale price is currently $556,675. Zillow also has a differing number, reporting that the median sale price is currently $561,775.
In their study, HSH.com further reported that the most affordable Metro areas are Pittsburgh, Cleveland, and Cincinnati, in order from most to least. The salaries for these areas ranged from the low- to high-$30,000s.
On the least affordable Metro areas, San Francisco unsurprisingly topped the list with a required salary of $161,947.60. San Diego made second place with a salary of $109,440.97, and Los Angeles ranked third with a salary of $92,091.89.
When looking at the median home price in the U.S., which is $240,700, HSH.com reported that one needs $52,699.17.
In their study, HSH.com analyzed data from the National Association of Realtors’ (NAR) 2016 second-quarter data for median-home prices and HSH.com’s 2016 second-quarter average interest rate for 30-year fixed-rate mortgages. The salaries compiled reflect the base cost of owning a home, which includes the principal, interest, taxes, and insurance. In order to come up with the numbers, a standard 28 percent "front-end" debt ratios and a 20 percent down payment were subtracted from the NAR’s median-home-price data.