Angelenos, congratulations — according to a, you officially live in one of the worst metro areas for first-time home buyers new study by Bankrate.com.
Out of the 50 largest metro areas surveyed, Los Angeles was ranked 49th for affordability, 48th for employment factors, 39th for housing market tightness as the statewide supply of homes for sale during COVID-19 -Pandemic has fallen to historically low levels, and 30th place safely. But on the flip side, LA took third place in wellness and culture.
Los Angeles was ranked as the “Worst Metro for First-Time Buyers,” followed by Las Vegas, Seattle, Riverside, and San Jose.
The typical seasonally adjusted home value for a home in the United States as of May 2022 was $349,816, which according to Zillow includes the mid-range home price range. Home values have risen 20.7% nationwide over the past year, he added.
For comparison: The typical home Value of homes in Los Angeles is $1,007,124, Zillow added, with property values up 17.1% over the past 12 months.
Widening the affordability gap
But Los Angeles, Riverside, and San Jose aren’t the only California cities that are out of reach, especially for first-time buyers. According to Bankrate, a personal finance website, 10 of the worst metro areas for first-time homebuyers are in California, including San Francisco, San Diego, and Sacramento.
“The housing boom of the past two years has widened the affordability gap between low-cost and high-priced metro areas,” Jeff Ostrowski, Bankrate’s senior mortgage reporter, said in a statement.
“But as remote work becomes the norm for white-collar workers, it’s possible to keep the fatter paycheck while still living in a cheaper area,” he added. “For this study, we not only looked at housing affordability, but also a variety of other factors, including local unemployment rates, commute times, crime rates and public health.”
The best places to buy a house
But there are some bright spots when buyers are open to moving, the survey found.
Pittsburgh, for example, was the “best” subway for first-time homebuyers, scoring high on affordability, lack of housing, suggesting cramped conditions, and safety. (Philadelphia home prices are up 6.5% over the past 12 months $233,563 as of May 2022Zillow Z,
To assess tightness in the housing market, Bankrate examined the average days in the market for housing for sale in March 2022, as reported by Realtor.com, and the annual change in housing stock through March 2022. (Realtor.com is owned by the same parent company as MarketWatch.)
Pittsburgh was followed by Minneapolis, Cincinnati, Kansas City and Buffalo as the top metro areas for first-time buyers. Bankrate also highlighted Philadelphia as a housing market that is not only more affordable than many western cities, but also ranked highly for its relative safety.
The survey drew on a variety of sources, including the US Census Bureau, the US Labor Department, and violent and property crime data released by the Federal Bureau of Investigation.
To calculate affordability, the researchers examined the typical income required to qualify for a mortgage in each metro area based on the median home price in the first quarter of 2022, as reported by Attom Data Solutions; a deposit of 10%; a 5% mortgage rate on a 30-year loan; plus a 25% mortgage debt-to-income ratio.
It also matched those numbers to the US Census Bureau’s latest estimates of the median income for households 25-44 year olds in each metro area, and calculated the homeownership rate for 25-44 year olds in each metro area.
For wellness rankings, Bankrate used the 2020 Community Well-Being Index published by digital healthcare company Sharecare SHCR.
which examines access to health care, food and community services, including libraries and churches.
The Culture Ranking examines the number of arts, entertainment and cultural institutions per capita, based on Bankrate’s analysis of US Census Bureau data.
https://www.marketwatch.com/story/los-angeles-is-the-worst-metro-area-in-america-for-first-time-home-buyers-but-you-may-be-surprised-by-the-best-11655090309?rss=1&siteid=rss&tesla=y Los Angeles is the “worst” metro area in America for first-time homebuyers — but you might be surprised by the “best.”