The income required to purchase a median-priced home in today's market depends largely on location and varies quite a bit across the country.
In Cleveland, you could earn $22,000 a year and still afford a house, but in San Francisco, you need to earn six times that — $125,072, — according to a report published by the National Association of Realtors.
HSH Associates, a publisher of mortgage data, evaluated 25 major metros to see how much income homebuyers need to purchase median-priced homes there and cover the principals and interest payments on their mortgages. The survey uses median home price data from the NAR's third-quarter report and subtracts a 20 percent down payment from these numbers. The list does not factor in taxes, mandatory insurance or homeowner fees.
Here are some of the cities where you would need to earn the least in order to purchase a median-priced home: $25,151 in Cincinnati; $25,228 in St. Louis; $26,863 in Atlanta; and $29,631 in Orlando.
Here are some of the cities that require the highest salaries to afford a median-priced home: $125,072 in San Francisco; $85,843 in San Diego; $79,177 in Los Angeles; and $71,255 New York City.
Q: How will the real estate market change in 2014?
A: Analysts vary greatly in their projections. Zillow, for example, is making bold housing predictions for 2014. It predicts that U.S. home values will increase by 3 percent, and that mortgage rates will reach 5 percent by the end of the year. It also believes that it will be easier for borrowers to get a mortgage in 2014.
According to Zillow's predictions, homeownership rates will fall to their lowest point in nearly two decades.
Q: How much have mortgage rates increased?
A: Freddie Mac released the results of its Primary Mortgage Market Survey, which shows average fixed mortgage increasing strongly, following better than expected reports on private job growth and new home sales.
The 30-year fixed-rate mortgage averaged 4.46 percent, around 0.5 percent higher than the previous week's average of 4.29 percent. A year ago at this time, the 30-year fixed-rate mortgage averaged 3.34 percent.
Q: Are homes that experienced a distress sale now increasing in value?
A: This is the current trend, according to analysts. While some across the industry are reporting waning price gains as we head toward winter, Clear Capital points out another interesting and perhaps counterintuitive trend occurring in the housing market.
Prior to the recovery, high saturations of distressed sales correlated with falling prices, but today's market reveals a switch, with high levels of distressed sales taking place alongside higher price gains.
Q: How long does it take to sell a distressed property?
A: Distressed inventory is on the decline, but the number of months it will take to clear these distressed homes from the market is on the rise. According to the latest report from Morningstar Corporate Credit Ratings, distressed inventory among nonagency residential mortgage-backed securities dropped 20 percent to 891,000 properties as of September.
However, Morningstar says it will take 49 months to work through this inventory, given current market dynamics. That's 11 months longer than the assessment in 2012.
Q: Is the number of mortgage applications increasing?
A: Yes, according to the latest survey report from the Mortgage Bankers Association. Mortgage applications increased 1 percent from a week earlier, show data from the MBA Weekly Mortgage Applications Survey.
The Market Composite Index, a measure of mortgage loan application volume, increased 1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index increased 43 percent compared with the previous week.
The Refinance Index increased 2 percent from the previous week and was 16 percent lower than the week prior to Thanksgiving.
To find out more about Jim Woodard and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.