Standard financial advice stipulates that spending more than 30% of your income on housing can put you at risk of being cost-burdened. The U.S. Department of Housing and Urban Development (HUD) further defines affordable housing as one in which a household spends less than this percentage. But how realistic is that metric for median-income earners? 

When other essential costs like groceries, childcare, and transportation increase, many households become financially strained. Exceeding the 30% threshold becomes unavoidable for some, particularly as wage growth doesn’t keep pace with increasing mortgage payments. 

Zoocasa analyzed average mortgage payments across 75 of the largest metropolitan areas in the U.S. to determine which cities’ median household incomes comfortably cover housing expenses and where households are more likely to be cost-burdened.

Half of American Households Are Cost-Burdened by Mortgage Payments

In 39 out of 75 cities analyzed, households must spend over 30% of their income on housing. This suggests that only households earning more than the median income can comfortably afford their monthly mortgage payments. To avoid straining their budgets, households earning below the median income may need to continue renting or purchase homes priced below the median for single-family homes.

In the five most extreme cases, households need to spend over 50% of their income on mortgage payments. Four of these highly cost-burdened households are located in California: San Jose at 79.2%, San Francisco at 65%, Los Angeles at 64.5%, and San Diego at 60%. Urban Honolulu and Miami are the only other cities outside of California where median-income households must spend over 50% of their income on housing. 

• Read: As the Rent vs. Buy Gap Intensifies, American Renters Face Greater Obstacles to Homeownership

Although incomes are quite high in many of these cost-burdened cities, elevated mortgage rates and high home prices still make housing affordability difficult for even the highest earners. Median-income households in Washington, D.C., bring home $10,122 a month, while the average mortgage payment of $3,281 represents 32.4% of their budget. 

Similarly, in Boston, median-income households must spend 42% of their monthly earnings of $9,225 on the average mortgage payment, equalling $3,872. For the 39 cost-burdened cities, the average monthly mortgage payment is $3,183, while the 36 cities that are not cost-burdened have an average monthly mortgage payment of $1,671. This indicates that high mortgage rates are the most restrictive factor preventing households from accessing affordable housing. 

Budget-Friendly Metros: Where Mortgage Payments are Easiest on Your Wallet 

Those living in smaller metropolitan areas have the best chance at affordable housing. Pittsburgh, Cleveland, and St. Louis are the three least cost-burdened cities, with households spending only 19.6%, 20.7%, and 21.8% of their respective incomes on mortgage payments.

• Read: From Affordability to Walkability: Ranking the Best U.S. State Capitals to Live In

Heading south, cost burdens start to increase a little but Oklahoma City, Tulsa, and Baton Rouge offer affordable housing for median-income earners. Additionally, all major metros in Texas remain affordable, with residents in Houston, Dallas, El Paso, and Austin spending only 27%, 27.8%, 28.9%, and 29.9% of their incomes on housing, respectively.

Budget-conscious buyers should generally stick to the middle of the country, as both coasts show more extreme cost burdens. This includes Florida, where none of the state's seven largest metros are considered affordable. Meanwhile, cities further from the coast, like Kansas City and Chicago, are less likely to be cost-burdened. 

Methodology: 

Median household incomes were sourced from the U.S Census Bureau. U.S. Census Bureau, U.S. Department of Commerce. "Income in the Past 12 Months (in 2023 Inflation-Adjusted Dollars)." American Community Survey, ACS 1-Year Estimates

Average monthly mortgage payments were calculated using the median single-family home price data from Q4 2024 from the National Association of Realtors, assuming a 20% down payment, a 30-year mortgage term, and a fixed interest rate of 6.89%. 

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