Approximately half of Americans believe that the lack of affordable housing in their city is a significant issue, as reported by a 2021 Pew Research Center survey. Pew also discovered that a growing number of Americans are worried about the decreasing affordability of housing in recent years, and it’s a valid concern.
With this information, Stacker examined U.S Census Bureau data to determine where homeowners are allocating the highest portion of their income towards mortgage payments. For inclusion, each metropolitan area needed to have a minimum of 100,000 mortgage holders in 2020, which is the most recent data.
People living in densely populated metropolitan areas across the United States are experiencing pressure on their mortgage payments due to the ongoing increase in home values nationwide. Experts have long relied on a standard measure for housing affordability. Keeping housing expenses within 30% of annual income allows for spending on other necessities like food, transportation, and health care.
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Examining the number of homeowners who allocate over 30% of their income to mortgage payments in a specific metro area can provide insight into the financial strain on the population. These homeowners are often referred to as “mortgage-burdened” by experts. Close to 49 million Americans have mortgages, with approximately 27% of them classified as mortgage-burdened, based on the latest Census data.
Most Mortgage-burdened Homeowners
Los Angeles
- Total mortgage holders: 1,498,220
- Share that are mortgage burdened: 41.8%
Los Angeles stands out as one of the most unaffordable places to live due to its exorbitant housing costs and significant homeless population. Households in LA typically earn $65,000 per year based on Census data. According to Realtor.com data, the average home is sold for $1 million.
Miami
- Total mortgage holders: 760,044
- Share that are mortgage burdened: 40.4%
Miami, a coastal paradise, is considered one of the more expensive cities in the country. It’s more crowded than LA, and the Miami Herald’s editorial board now considers the lack of affordable housing in the metro area a full-blown “crisis.”
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San Diego
- Total mortgage holders: 434,507
- Share that are mortgage burdened: 38.5%
San Diego Mayor Todd Gloria initiated a campaign in March 2022 to encourage new home construction in order to address the current housing shortage that is causing housing costs to rise for residents. The city offers a similar natural, oceanside beauty as LA but has only about half the population density, according to Census data.
Riverside, California
- Total mortgage holders: 621,258
- Share that are mortgage burdened: 38.1%
Riverside is located just an hour’s drive east of Los Angeles and is a part of the metropolitan area known as the Inland Empire. Home prices in Riverside have almost tripled over the past twenty years. According to some experts, the increasing trend of remote work is encouraging more workers to buy homes in less crowded areas of the state.
New York
- Total mortgage holders: 2,298,350
- Share that are mortgage burdened: 38.1%
Many people assume that New York City is one of the most expensive places to own a home in the U.S., and a large percentage of homeowners there struggle with mortgage payments. Realtor.com data shows that the current selling price for the median home in New York is $860,000. The city is facing a severe lack of housing, which is driving up rental costs and mortgages. With housing expenses reaching record levels, politicians are under significant pressure to address the shortage.
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