In the wake of the subprime mortgage crisis, housing became much more affordable as prices dropped. Since peaking in 2012, however, affordability has rapidly declined. Inventory of for-sale homes fell faster in May than it has in years, and home prices have risen substantially in turn.
Homeownership in the United States has declined in recent years. The homeownership rate reached 63.6% this year, nearly the lowest level since the Census Bureau began tracking the data over 50 years ago, and down from a peak of 69.2% in 2004.
> Metro area: Los Angeles-Long Beach-Anaheim, CA
> Avg. % of wage spent on housing: 56.9%
> Avg. monthly wage: $5,000
> Median home ownership cost: $3,514
> Median rent, 3 bedrooms: $2,249
Some areas are far less affordable than others, and in some parts of the country, typical rents and home prices are only affordable to high earners in the area. Based on data provided by real estate data company ATTOM Data Solutions and 24/7 Wall St.’s calculations, we identified the 25 counties where housing is the least affordable relative to average area wages.
Of the 25 least affordable housing markets, 16 are located in California, with many clustered around the Silicon Valley area. Many people move to these areas for the specialized, high-paying jobs available. However, even with some of the highest incomes in the country, typical housing costs are well out of reach for most residents.