Affordable Housing Markets
The Street publishes the five most-affordable housing markets in the U.S.
- St. Louis
The analysis looks at only the 25 largest cities in the U.S. and calculates the amount one would pay each month for a median-priced home, assuming 20% down and a 30-year fixed mortgage that charged the local average interest rate. None of these cities would be considered a Smart Growth City although Minneapolis perhaps comes close. Using similar methodology, we also see the five least affordable markets:
- San Francisco
- New York
- San Diego
- Los Angeles
Certainly San Fran and New York qualify as Smart Growth Cities, but there’s enough “plausible deniability” to keep the label off the others. In fact, Miami and Los Angeles generally have a poor reputation among planners who see them as sprawling cities. Yet, both Miami and Los Angeles share key characteristics of Smart Growth: Density and Public Transportation.
A generation ago, both cities began building new roads less and invested much more in public transit, including rail transit. Both cities have also promoted super high densities as a way to contain outward growth. In fact, let’s look at these ten cities to show how the densities (i.e., people per square mile) relate to affordable housing. Using 2010 Census data:
- San Francisco 17,179 people per square mile (unaffordable)
- New York City 11,138 people per square mile (unaffordable)
- Los Angeles 8,231 people per square mile (unaffordable)
- Minneapolis 7,088 people per square mile (affordable)
- St. Louis 5,157 people per square mile (affordable)
- Detroit 5,144 people per square mile (affordable)
- Miami 5,129 people per square mile (unaffordable)
- San Diego 4,020 people per square mile (unaffordable)
- Atlanta 3,154 people per square mile (affordable)
- Phoenix 2,797 people per square mile (affordable)
If we were to broaden our search beyond the Top 25, the relationship between density and affordability would become even clearer. Better yet, Wendell Cox has already published the 2012 Demographia International Housing Affordability Survey.