Top 8 Most Affordable Markets

Oklahoma City skyline at twilight.

If you look at certain real estate markets, you might assume that homes all across the country are expensive, to the point that some people can only afford small properties. While there are certainly some hot housing markets in the U.S., there are also locations where housing is more affordable, especially when compared to typical earnings for the region.

If you are looking to land a job, purchase a home, and enjoy an affordable cost of living, you may want to consider one of these American cities…

How Were The Numbers Determined?

To create this analysis, we relied on numbers provided by the First American Financial Corporation and reported by National Mortgage News. First American Financial looked at the purchasing power of first-time homebuyers in the 50 largest American metropolitan areas. They looked at the median income of renters, which gave them a reasonable starting point for the buying potential of people who would be seeking their first home.

Once they had the median income in an area, they could analyze what percentage of the available homes could be purchased with those earnings. Basically, if they found that the median income in a certain area was, for example, $40,000, they could then determine what percentage of for-sale homes could be purchased with a $40,000 annual income.

To make the list, therefore, a city has to have two things going for it: 1) It has to have a solid median income, as people in the area need to earn enough to afford a quality home. 2) The market has to have reasonably-affordable housing; even if earnings are high, if the housing is too expensive a large percentage of properties will be unavailable to first time homebuyers.

Top 8 Most Affordable Markets: Where Typical Incomes Give Access to the Most Homes

1. Oklahoma City, Oklahoma

Renter Median Income: $35,700
Median Sale Price: $171,916

New-Buyer Affordability: 74%

It’s the state capital, regional economic hub, and it even has an NBA team. There is a lot to enjoy in Oklahoma City, but what makes it even more attractive it it’s affordability. According to the numbers from First American Financial, first-time homebuyers have realistic access to roughly three quarters of the available market. It seems this is largely due to the low cost of homes in the area, as a median price of $160,000 is certainly affordable. This is a trend that we will see repeated; most of the markets don’t have sky-high incomes, but rather have affordable houses that are attainable for people living on even modest budgets.

2. Louisville, Kentucky

Renter Median Income: $42,840
Median Sale Price: $182,050

New-Buyer Affordability: 73%

Louisville is a town with a rich, vibrant heritage. Named for a French king, the city is an American classic, with roots in baseball (the Louisville Slugger factory), boxing (the hometown of Muhammad Ali), and the famous fried-chicken chain. But it’s also a modern town that remains surprisingly affordable, as new buyers can likely afford roughly 73% of the for-sale homes.

3. Memphis, Tennessee

Renter Median Income: $37,873
Median Sale Price: $158,537

New-Buyer Affordability: 72%

Located on the Mississippi River, Memphis is one of the most interesting towns in all of America. Most notable is this city’s contributions to American music, as Memphis was crucial in the development of rock and roll, blues, and country. Today, people can actually move to this city and purchase a top-quality home without emptying their account. With median home prices under $160,000, and a median renter’s income of about $38,000, first-time home buyers should have access to roughly 72% of the homes listed on the market.

4. Birmingham, Alabama

Renter Median Income: $38,760
Median Sale Price: $161,816

New-Buyer Affordability: 71%

A city with a population just over 209,000, this metro area is the most populous city in Alabama. The steel industry is a major player in the local economy, although its importance has dimmed over the past few decades. Today, biotechnology and banking also play a major role, bringing jobs and activity to the area. The median income for renters in the area is $38,760, but the median home sale price is only $161,816. This means new buyers should be able to afford roughly 71% of the homes in this city.

Statute and Kansas City skyline
Thanks to strong incomes for new buyers, Kansas City offers excellent housing affordability.

5. Kansas City, Missouri

Renter Median Income: $47,153
Median Sale Price: $220,172

New-Buyer Affordability: 71%

Visit Kansas City and you can see Major League Baseball or watch an NFL game. You could even visit the nearby Harry Truman Library and Museum, located in Independence, Missouri. Live in “KC” and you’ll not only enjoy a vibrant modern city, you’ll also enjoy outstanding affordability. The median sale price was over $220,000, but with a median renter income of $47,153 (which ranks fairly high on this list), new buyers should be able to purchase about 71% of the listed homes.

6. Pittsburgh, Pennsylvania

Renter Median Income: $37,126
Median Sale Price: $157,750

New-Buyer Affordability: 70%

The Steel City has more going for it than just the steel industry. While steel continues to plays a role in this town’s economy and image, there are now other businesses, including robotics, biomedical technology, and nuclear engineering, that drive Pittsburgh in the 21st century. Housing in this market is surprisingly affordable, with a median sale price of $157,750; with a median income for renters at $37,126, most will have financial access to about 70% of the listed homes.

7. Tampa, Florida

Renter Median Income: $43,679
Median Sale Price: $207,333

New-Buyer Affordability: 69%

Enjoying access to Tampa Bay and the Gulf Coast, Tampa is a major city that brings economic activity, tourism, and entertainment to the region. The region has a diverse economy, with finance, retail, shipping, and many other industries playing a role. People working in the region can enjoy affordable housing, and most new buyers will be able to afford about 69% of the available homes.

8. Atlanta, Georgia

Renter Median Income: $46,920
Median Sale Price: $221,816

New-Buyer Affordability: 68%

As the capital and largest city of Georgia, you could certainly expect this market to have significantly expensive housing. But that is not the case, as new home buyers can afford roughly 68% of the available houses. The housing is on the high end for this list (a median sale price of $221,816), but strong wages allow most people to purchase a top quality home.

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I hope you enjoyed reading this article. It's my goal to keep you updated with the latest real estate mortgage news. I'm proud to provide you with 100% original and unique content. Subscribe now to get high quality real estate mortgage content and articles delivered directly to your inbox. Chad Baker is Regional Manager for Cross Country Mortgage. Chad is consistently recognized in the top 1% of mortgage originators in the United States 2011-2019. Got a question for Chad? Call (858) 353-8331 or submit your question online