Can young adults afford to buy a home in Houston? Yes, according to new report, but we're not so sure
A new report from Bloomberg finds that millennials are being priced out of homeownership in many major U.S. cities, but the situation is better in Houston.
On a list that includes 50 metropolitan areas, Houston ranks as the No. 36 least affordable city for millennials — or to interpret it another way the 15th most affordable on the list.
In Houston, where the median home value is $159,450, the minimum salary required to purchase a home is $35,034. With a median income of $21,633, millennials in Houston have a surplus of $13,401. What the report doesn't take into account is that finding a home for under $160,000 in a millennial-friendly Houston neighborhood seems just about impossible.
Even if such housing exists, Bloomberg cautions that these numbers assume that young adults have saved a 20 percent down payment, which often is not the case. "That means millennials living in unaffordable markets will be forced to shell out money for ever-increasing rents, instead of building equity," Bloomberg says.
Thirteen metropolitan areas have an affordability gap, where millennials are priced out of the market. In such places as San Jose, New York, Los Angeles, Boston, Seattle and Denver, the minimum salary required to purchase a home far surpasses the median millennial earnings.
Millennials will have the best luck in Detroit, Pittsburgh and Buffalo — the three most affordable cities on the list. Austin is the least affordable city in Texas at No 16, with Dallas-Fort Worth (No. 34), and San Antonio (No. 28) faring better.
To see the stats on each city, check out the full Bloomberg report.
CultureMap editor-in-chief Clifford Pugh contributed to this article.