The income to buy or rent a Baltimore-area home
Have declining home prices and mortgage rates put buying in the reach of more people? Yes, according to a new report -- though the authors say the market downturn hasn't been an affordability bonanza.
Buyers needed a household income of about $79,000 to afford the median-priced home in the Baltimore metro area last year, better than the $88,000 needed in 2007, according to the Center for Housing Policy's Paycheck to Paycheck study. But that still locks out a lot of people in professions that pay less, the center says.
Median household income in the Baltimore metro area was $68,000 in '07, the most recent estimates from the Maryland Department of Planning.
The Paycheck to Paycheck report puts our metro area's median home price at $243,000 last year. Thirty-three metros were pricier, while more than 170 were less expensive. Even though prices fell here last year, we rose in the rankings -- meaning the area is comparatively pricier -- because some metros are shedding value at a much faster pace.
Also, the decrease in income needed to buy a median home is smaller here than in many other parts of the country -- 10.5 percent vs. 14.5 percent nationally. (The report authors assume a 10 percent downpayment and no more than 28 percent of income spent on the mortgage, property taxes and insurance.)
But what about rents? They've gone up in many places. Nationally, rents rose 3.7 percent last year in urban places, the report says.
The HUD-defined "fair market rent" for a two-bedroom unit in the Baltimore area was $1,037 at the end of last year, ranking us 41st among 210 metro areas. First -- and therefore most expensive -- was San Fransisco, at $1,658. The least expensive: Wheeling, W. Va. ($577).
Are rents rising or falling for you renters out there?
And if you're looking to buy, are you noticing any significant change in the types of homes you can afford?