With the quick escalation of home prices during the pandemic, it’s become increasingly difficult to qualify for a typical mortgage. This week we return to the quarterly report from HSH.com, which breaks down the annual income required to qualify for a mortgage in the country’s 50 largest metropolitan areas.
Using 2021 second-quarter sale price data for single-family homes from the National Association of Realtors (NAR), and factoring in the industry standard 28 percent debt-to-income ratio to qualify prospective borrowers, the report determined the income required for a mortgage in each area. (A 20 percent down payment and a fixed-rate, 30-year loan at current rates were assumed, and local property taxes and homeowner’s insurance costs were included.)
NAR’s national median sale price in Q2 2021 was $357,900, roughly 22 percent higher than a year earlier. At that price, an annual income of $68,032 would be required to qualify for a mortgage, with a monthly payment of $1,587.
Most affordable was Pittsburgh, where the median sale price of $175,000 required an income of $38,275 and monthly payments of $893. San Jose, Calif., with a median sale price of $1.699 million, required the highest income, $286,703, with a monthly payment of $6,690.
This week’s chart shows what you’d need to earn in the 10 most affordable and 10 least affordable metros, and what your monthly loan payment would be in each.
Source: | This article originally belongs to Nytimes.com
