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GOBankingRates
You Can Afford a Mortgage in These 13 Cities on Just a $40K Salary
By Crystal Mayer,
13 hours ago
If you have dreamed of owning your own home but have been afraid that your salary won’t cover your mortgage , you are not alone. Many people cite cost barriers as the number one reason they do not buy property. Luckily, there are cities nationwide where you can purchase a home making a salary of $40,000 or less.
Salary needed to afford mortgage with 20% down payment: $21,763
Savings needed for 20% down payment: $21,587
Annual mortgage with 20% down payment: $6,529
Average typical home value: $107,935
Toledo, Ohio
Salary needed to afford mortgage with 20% down payment: $24,133
Savings needed for 20% down payment: $23,938
Annual mortgage with 20% down payment: $7,240
Average typical home value: $119,690
Birmingham, Alabama
Salary needed to afford mortgage with 20% down payment: $25,120
Savings needed for 20% down payment: $24,917
Annual mortgage with 20% down payment: $7,536
Average typical home value: $124,586
Akron, Ohio
Salary needed to afford mortgage with 20% down payment: $26,374
Savings needed for 20% down payment: $26,160
Annual mortgage with 20% down payment: $7,912
Average typical home value: $130,801
Dayton, Ohio
Salary needed to afford mortgage with 20% down payment: $28,797
Savings needed for 20% down payment: $28,564
Annual mortgage with 20% down payment: $8,639
Average typical home value: $142,820
Memphis, Tennessee
Salary needed to afford mortgage with 20% down payment: $29,721
Savings needed for 20% down payment: $29,481
Annual mortgage with 20% down payment: $8,916
Average typical home value: $147,405
St. Louis
Salary needed to afford mortgage with 20% down payment: $35,357
Savings needed for 20% down payment: $35,071
Annual mortgage with 20% down payment: $10,607
Average typical home value: $175,356
Brownsville, Texas
Salary needed to afford mortgage with 20% down payment: $37,477
Savings needed for 20% down payment: $37,174
Annual mortgage with 20% down payment: $11,243
Average typical home value: $185,869
Baltimore
Salary needed to afford mortgage with 20% down payment: $37,738
Savings needed for 20% down payment: $37,433
Annual mortgage with 20% down payment: $11,321
Average typical home value: $187,163
Syracuse, New York
Salary needed to afford mortgage with 20% down payment: $37,946
Savings needed for 20% down payment: $37,639
Annual mortgage with 20% down payment: $11,384
Average typical home value: $188,194
Mobile, Alabama
Salary needed to afford mortgage with 20% down payment: $38,773
Savings needed for 20% down payment: $38,459
Annual mortgage with 20% down payment: $11,632
Average typical home value: $192,297
Wichita, Kansas
Salary needed to afford mortgage with 20% down payment: $39,923
Savings needed for 20% down payment: $39,600
Annual mortgage with 20% down payment: $11,977
Average typical home value: $197,998
Methodology: For this piece, GOBankingRates looked at the 50 largest housing markets with 2024 typical home values below $300,000, as sourced from July 2024 Zillow data. GOBankingRates deemed this “affordable,” as the national average is $361,433, thus $300,000 and below is well below the national average (15% plus). With these cities isolated, GOBankingRates found the following: (1) savings needed for a down payment at 20%, 15%, 10% and 6%; (2) annual mortgage cost at 20%, 15%, 10% and 6%, respectively; and (3) salary needed to afford the mortgage at 20%, 15%, 10% and 6%, assuming that no more than 30% of pre-tax income should be put towards housing. For all mortgage calculations, GOBankingRates assumed a 30-year fixed rate at 6.47%, as sourced from Freddie Mac, with no P+I, property tax or HOA fees. All data was collected and is up to date as of Aug. 13, 2024.
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