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If you’re spending more than 30% of your gross monthly income on living expenses, you might be what’s known as “house poor.” A recent survey by HomeTap found that nearly 20% of U.S. homeowners feel like their monthly housing costs impede their ability to achieve other financial goals most of the time, and an overwhelming 73% feel it some of the time.[1]
House poor is a term used to describe a homeowner or renter who spends so much on housing that they can’t afford much else. Financial advisors recommend spending no more than 30% of your gross monthly income on housing expenses. These expenses include your monthly mortgage payments, homeowners insurance, and any other unexpected costs that may arise (such as a broken air conditioner).
Because location plays such a big role in housing costs, we took a look at the numbers to see where homeowners are spending the most and least in housing costs by region. We compared the median home price, the median household income, and the homeownership rates of the 100 most populous U.S. cities in our study
Check out our results below, or jump to a specific region here:
The South is known for its warm weather, friendly residents, and soulful cooking. Yet these three popular cities in the region are expensive places to call home, thanks to low median household incomes and high median home prices.
Miami may be a great place to party on the beach, but it’s not the best place to buy a home if you’re strapped for cash. While this international destination is known for its nightlife, high-end restaurants, and a thriving tourism industry built upon white sand beaches, the high cost of living and low wages make it an unaffordable homeowner hotspot on the east coast of Florida.
Virginia’s state capitol is rich in history, brick-lined buildings, and residents who are paying too much for their expenses, thanks to high housing prices and a median household income of $45,117. The city, located just two hours outside of Washington D.C., is deemed a hipster haven due to its eclectic neighborhoods, street murals painted by famous artists, and craft beer scene.
America’s Creole capital is home to the famous Mardi Gras parade and Bourbon Street. The city features delicious cuisine, vibrant nightlife, and a rich arts and culture scene, but with a median household income of $39,576, city residents struggle to pay for housing within city limits.
Southern hospitality is extended to homeowners in these three cities, where residents can enjoy all that the South has to offer without the unaffordable price tag.
“Sun City” is a southwestern paradise located along the Rio Grande. El Paso shares its border with the Mexican city of Ciudad Juárez, which helps contribute to its rich diversity and unique culture. El Paso is also home to a strong federal and military presence, which provides lots of jobs and opportunity in the area.
Cowboy culture and affordable home prices make this a great Southern city to call home. You can enjoy tons of microbreweries, western museums, and a high homeownership rate of 59%. Oklahoma City has also been named the most recession-proof city in America and the most affordable city in America.[2]
You’ll find beaches, military bases, and boardwalks in this coastal Virginian city. You can also enjoy family-friendly activities, fresh seafood, and average household income that make owning a home here feasible, despite higher-than-average home prices.
The largest city in the Garden State also has one of the lowest homeownership rates in the country. Newark sits just eight miles outside New York City and is recognized as one of the cultural epicenters of New Jersey, but it’s not as well known for its affordability. The median household income is just $35,181, which makes the median home price of $281,694 hard to afford for many residents.
It comes as no surprise that the city that never sleeps also boasts high price tags and low home ownership rates. New York City has a notoriously high cost of living and a median home price of $410,000. With so much to do and see in the city, including over 27,000 restaurants, homeowners are also at a greater risk of lifestyle cost inflation here.
Here you’ll find Fenway Park, plenty of cultural attractions, and famous historical landmarks such as Boston Harbor. Due to high housing demands, you’ll also find plenty of house-poor homeowners.
The “Steel City” is home to six-time Superbowl champs The Steelers and 300 steel-related businesses. The home prices in this Pennsylvania city are so low that they can be considered a steal, especially when compared against the median household income of $45,831. In addition to affordable housing, you’ll find myriad museums, a thriving tech market, and 29 college campuses.
Nestled near the Canadian border, Buffalo is a city full of beer-loving sports fans bursting with city pride. Affordable home prices are just one of the reasons the people of Buffalo love living in this quaint Upstate New York downtown.
Living in our nation’s capital may come with a high price tag, but it also comes with a median household income more than $20,000 higher than nearby New York City. If you’re interested in living near our three branches of government, you’ll feel right at home in this urban metropolis with its famous landmarks, world-renowned museums, and public transit.
Of the four regions, the Midwest does boast the lowest housing costs, yet many homeowners still struggle with feeling house poor in these three cities.
Detroit’s housing market has been making headlines for years due to the city’s economic and population decline. Despite relatively low housing costs, the low household income of $29,481 in Detroit still makes housing unaffordable to residents in this Midwest metropolis. In 2017, more than 22% of residential structures in Detroit were likely to be abandoned.[3]
This twin city has a great education system and winter festivities galore, but a lull in the economy over the past ten years has made its citizens more prone to being house poor. This is due to the high home prices compared to the median household income of $55,085.
If you love bratwurst, block parties, and beer, this midwestern city may seem like the perfect place for you. Yet low home ownership rates and a low median household income make this destination an unaffordable place to buy a home.
Enjoy easy living, affordable home prices, and the highest home ownership rates in the country in these midwestern cities.
Indy boasts one of the highest home ownership rates in the country at 73%. This state capital is also known for its international racing speedway, war memorials, and gorgeous waterways. If you love motorsports, history, and affordable housing, this thriving economy may be the place for you!
Kansas’ largest city has a low cost of living, plenty of space, and an abundance of bike trails for residents to enjoy. Wichita is also home to one of the shortest commutes in the nation[4]. The city’s median household income is $50,867, which may be one reason why many city dwellers don’t consider themselves “house rich, cash poor.”
The reigning Super Bowl champs call Kansas City, Missouri home. Jazz enthusiasts and barbeque lovers can enjoy a low cost of living and a median home price of $143,000 in this Midwestern stop.
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Oakland is one of the most ethnically diverse cities in the United States, and it’s also one of the least affordable for homeowners when you compare its median home prices to its median household income. Nearby Silicon Valley has caused prices in the area to skyrocket, so while you’ll find the San Francisco Bay, the largest African-American community in California, and one of the nation’s largest proportion of female couples, don’t expect affordable mortgage costs.
Los Angeles is considered the film and entertainment capital of the world, and in addition to a vast and creative job market, the city has beautiful beaches, neighboring mountains, and a comfortable Mediteranean climate. Yet living in Los Angeles definitely comes with its pitfalls, from the traffic to the high home prices and one of the lowest home ownership rates in the country.
Honolulu is the largest city in the Hawaiian islands, and it experiences a year-round tropical climate that makes it (and its neighboring islands) a hotspot for tourism. Living in paradise doesn’t come cheap: with a median home price of $600,000, many Honolulu residents consider themselves “cash rich, house poor.”
While this desert city may be best known for “Breaking Bad”, hot air balloon rides, and Dia De Los Muertos celebrations, it’s also a great place to own a home. Experience mountain views to the east, volcano views to the west, and sunny skies above.[5] This house-rich city is also a great spot for nature lovers as 28% of Albuquerque is dedicated to parks and green space.[6]
Located just southeast of Phoenix, this suburb has low crime rates and the highest household median income in the region. Once known as “Hay Shipping Capital of the World,” Gilbert has earned a reputation for being a great place to live in the Western U.S.
Alaska’s largest city is the perfect place to call home for nature lovers looking to avoid being house poor. Residents enjoy cold winters, mild summers, and plenty of wildlife thanks to the area’s nearby mountains and glaciers.
If you are looking to buy a house, remember: in addition to your monthly mortgage payments, there are other hidden costs that come with owning a home. Homeowners insurance, utilities, and unforeseen costs also eat into your monthly housing spend and can contribute to the feelings of “house rich, cash poor.”
Thinking carefully about the city in which you purchase a home is one great way to prevent becoming house poor. Budgeting, putting down a larger down payment, and saving more before you buy can help make your monthly payments more manageable.
In order to determine the most and least house poor cities by region, The Zebra compared a sample of the 100 most populated U.S. cities. Our sample for overall most and least house poor cities excluded cities in the surrounding metro area.
We rated each city on a sliding scale based on these three factors:
Our calculations revealed cities with the largest gap in median household income compared to median home price were the most house poor cities in the nation. We also found that cities with more affordable housing had a higher ownership rate, as did cities with higher median household incomes.
New Hometap Study Shows 1 in 5 U.S. Homeowners Feel House Rich, Cash Poor. Globe Newswire
30 Things You Need to Know About Oklahoma City Before You Move There. Movoto
Why Is Detroit so Empty? Faith and Public Life
Living in Wichita, Kansas. U.S. News
RANKING OF CITIES BASED ON % ANNUAL POSSIBLE SUNSHINE IN DESCENDING
ORDER FROM MOST TO LEAST AVERAGE POSSIBLE SUNSHINE. NCDC
8 Must-See Places in the US For Nature Lovers. Treehugger
