Affordable starter homes are disappearing across the U.S. as housing costs soar to new highs and first-time buyers compete for a limited supply of entry-level properties, but four major cities still offer reasonable starting points for new buyers. Despite a chronic housing shortage and fast-rising home prices, starter homes are still relatively affordable for those earning the median household income in Detroit, Tulsa, OK, Memphis, TN, and Oklahoma City, CNBC reports.
Of the four most affordable cities for starter home purchases, Oklahoma City is the only market where the median entry level home price is above $100,000, but the metro’s median annual income is also the highest on the list.
Aside from a chronic shortage of housing that predates the Covid-19 pandemic, supply constraints and growing costs for building materials have contributed to increasing home prices, says Lawrence Yun, chief economist at the National Association of Realtors.
And with home prices up by nearly 30%, “we know for sure people’s incomes have not risen by 30%,” he says.