Pack your bags for Staten Island; Brooklyn is now the worst place in America for home affordability, according to a new report by housing data group RealtyTrac. Second place is San Francisco, followed by Manhattan.
RealtyTrac studied 475 county's housing prices in October in an attempt to spot upcoming housing bubbles, comparing the figures from the 2005-2008 bubble. The good news is there's not an impending nationwide housing crash! The bad news? Affordability is down, with one in five housing markets exceeding their "historical affordability norms."
They calculate affordability by finding what percent of a median income a resident would need to spend on a mortgage each month. Worst of them all is Kings County, New York, where a Brooklyner making a median income would need to set aside 98 percent of their salary to pay for a median-priced home of $615,000. But you can make do on 2% right? Food is too fattening anyway.
Also alarming is that the 98 percent is up from 95 percent, which has been the affordability level since 2000. Keeping five percent ain't much better than two, but RealtyTrac Vice President Daren Blomquist says the buyer's market is now driven by people who aren't concerned with income at all.
"Incomes have not grown nearly as fast as home prices," Blomquist tells Bloomberg News. "That disconnected home-price growth has been driven by investors and other cash buyers who aren't as constrained by income."
So until you're part of the group that doesn't feel the pesky "constrain" of relying on a yearly salary, plan on renting forever.