In the final quarter of 2016, home prices in the US climbed past expectations as the housing supply reached record lows, according to the National Association of Realtors (NAR).
On average, 87% of the 150 housing markets tracked by NAR experienced rising home prices in 2016, up from an average of 75% in 2014. More than half of the markets (52%) now have a median sale price either at or above their previous record high.
"Buyer interest stayed elevated in most areas thanks to mortgage rates under 4% for most of the year and the creation of 1.7 million new jobs edging the job market closer to full employment," said Lawrence Yun, NAR chief economist. "At the same time, the inability for supply to catch up with this demand drove prices higher and continued to put a tight affordability squeeze on those trying to reach the market."
The group reports that while the national median family income rose to $70,831, increasing mortgage rates and home prices will affect Americans' ability to buy a home, specifically in the country's most expensive housing markets.
Using NAR's data on housing affordability, we gathered a list of the US metro areas where the minimum salary required to qualify for a mortgage, with 20% down, is the highest. NAR assumes a mortgage rate of 3.9% for all areas, with the monthly principle and interest payment limited to 25% of income.
For the US as a whole, the average qualifying income is $42,962 and the median home price is $232,200.
Notably, the salary needed to qualify in the top-five metro areas — four of which are located in California — exceeds $100,000.
Below, check out how much you need to earn to buy a home in the most expensive housing markets, and what the median home will cost you.
The following markets are based on metropolitan statistical areas, with the exception of Anaheim-Santa Ana-Irvine and Los Angeles-Long Beach-Glendale, which are metropolitan divisions.
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23. Salt Lake City, Utah
Population: 1,170,266
Median home cost: $282,100
Salary needed to buy: $51,572
22. Austin-Round Rock, Texas
Population: 2,000,860
Median home cost: $287,600
Salary needed to buy: $52,578
21. Burlington-South Burlington, Vermont
Population: 214,363
Median home cost: $291,300
Salary needed to buy: $53,254
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