For Many Large Cities, Affordability Problems Persist

In many large cities, more than 50 percent of households cannot afford a home, according to a new study by GOBankingRates, Los Angeles.

Six cities on the U.S. coasts have a 70 percent or higher percentage of households that can’t afford a home, GOBankingRates said. Perhaps unsurprising due to its high real estate prices, six of the top 10 cities with the highest percentage of households that can’t afford homes are in California.

However, some surprising cities made the final list. In New Orleans, the median home price is $300,000 but 65.4 percent of households can’t afford a home because wages are lower. On the other hand, median home prices in Oakland, Calif., are half as expensive as they are across the bay in San Francisco.

GOBankingRates used the median home listing price in the 100 largest cities to calculate typical monthly mortgage payments. Using the rule that no more than 30 percent of income should go toward housing, GOBankingRates calculated the income needed to afford a mortgage. Researchers then compared this income to the number of households with income equal to or greater than that amount.

The study said cities with the highest percentage of households that can’t afford a home include:

—San Francisco. Median listing price: $1,199 million; percentage of households that can’t afford a home: 76.7 percent.

—Boston. Median listing price: $725,000; percentage of households that can’t afford a home: 75.7 percent.

—Miami. Median listing price: $450,000; percentage of households that can’t afford a home: 74.3 percent.

—Long Beach, Calif. Median listing price: $549,900; percentage of households that can’t afford a home: 73.5 percent

—Los Angeles. Median listing price: $749,000; percentage of households that can’t afford a home: 72.9 percent.