In 2020, households with median incomes could typically afford a home in the U.S., but now they’re facing a daunting challenge. Nowadays, it turns out they need an additional $17,670 to do so, according to analysis from Zillow.
Currently, the average home price sits at around $367,969, which translates to a required salary of nearly $100,000 to manage a comfortable mortgage.
For households making a median income of $82,168, that means they would need a raise exceeding 20%, or close to $18,000, to support a typical mortgage.
Looking at California specifically, earning a median income won’t cut it. A significant salary bump—often six figures—is required to secure a home.
For instance, in San Jose, the median earners would need to find an extra $250,000 to qualify for a typical mortgage, even if they’ve managed to set aside $330,000 for a 20% down payment. Similar situations exist in San Francisco, where buyers need an additional $165,566; Los Angeles requires $149,375, while in San Diego, it’s $128,954.
“Prices remain steep for many,” remarked Kara Ng, a senior economist at Zillow.
Based on Zillow’s findings, here are the ten cities needing the largest salary increases to afford typical mortgage payments:
These figures consider a 20% down payment and are based on local median incomes.
| City | Salary Increase Needed for Typical Mortgage |
| San Jose, California | $251,597 |
| San Francisco, California | $165,566 |
| Los Angeles, California | $149,375 |
| San Diego, California | $128,954 |
| New York, New York | $99,343 |
| Seattle, Washington | $84,356 |
| Boston, Massachusetts | $78,703 |
| Riverside, California | $60,685 |
| Miami, Florida | $59,379 |
| Sacramento, California | $53,660 |
Interestingly, Zillow reports only 11 major markets currently where median incomes are adequate for typical mortgage payments. These areas are primarily found in the Midwest and Northeast.
For example, in Cleveland, median earners are in a fortunate position, typically making about $11,500 more than necessary to purchase a typical home. Pittsburgh is another market benefiting from similar circumstances, with median earners bringing in an extra $11,200. Meanwhile, St. Louis and Cincinnati also show a favorable difference of $4,897 and $4,396 respectively.
To be considered affordable, it’s generally accepted that monthly mortgage payments should not exceed 30% of a household’s income.
Although there’s still a high demand for affordable housing, it’s clear that simply entering the spring home viewing season with rising stocks and more sellers won’t resolve the underlying issues facing potential buyers.
Ultimately, Ng emphasizes, “To improve accessibility to homeownership, we have to focus on longer-term solutions, beginning with policies that facilitate the construction of more homes where they are truly needed.”
