Can You Afford a House in These Major Cities

Interest rates for mortgages in the United States are still quite low, which makes it a good time to buy a house. However, amid rising housing prices and not so much rising salaries, the main question is if you still can afford to get one.
According to the recent report by HSH.com, to afford the monthly payments for a house that costs the American medium of $240,700, average you should be earning $52,700. In fact, housing prices vary greatly depending on a city. For example, if you live in Orlando, Florida, you would only need to earn about $50,000 a year to afford a house. At the same time, In Boston, you would need to be earning almost $88,000. At the same time in San Francisco, one should be earning a whopping $161,947.60, almost four times of that in Boston.

Financial advisers usually recommend spending not more than one-third of the salary on accommodations. The numbers featured in this report assume that the mortgage payments would not exceed 28 percent of gross monthly income (principal, interest, taxes and insurance included).

Another factor that affects housing prices is the amount of real estate available in a particular city. For example, if the demand for houses is growing, but no new houses are built, the prices are likely to go up, as it happens in Denver. The contrary is supposed to stay true (not always does in our capitalistic world). In theory, a city where there are more houses built than people willing to rent them, prices go down. A somewhat truthy example of it is New York City. Although it would be misleading to blame currently declining prices on housing oversupply, as there are plenty of other factors affecting the prices. Either way, study the information provided on the picture about in case you are planning to buy a house somewhere, or if you are just a curious one. Besides that, please do contact independent mortgage advisers who wouldn't try to rip you off.