15 Cities Where Home Prices Have Grown Faster Than Income

Unhappy homeowner
Antonio Guillem / Shutterstock.com

This story originally appeared on Construction Coverage.

Despite decades of record-setting home sales, owning a home has become increasingly difficult for the average worker. Mortgage interest rates are historically low, yet hourly earnings have failed to keep pace with rising housing costs.

Data from the federal government indicates that although earnings for production and nonsupervisory workers increased by approximately 80 percent between January 2000 and April 2020, housing costs have nearly doubled during the same period.

The rise in home prices over the past several years has occurred during a period of increased housing demand — driven by a growing economy and more millennial homebuyers — as well as a shortage of new, single-family homes available for purchase.

At the same time that home prices have gone up, wages for the average worker have failed to keep pace. Research from the Economic Policy Institute shows that while wages for high-income workers grew steadily since the 1980s, middle- and low-income workers have actually seen their wages stagnate or even decline after adjusting for inflation.

To identify metropolitan areas with the greatest rise in home prices relative to income, researchers at Construction Coverage, a review website for builders insurance and worker’s compensation insurance, analyzed data from Zillow and the U.S. Bureau of Labor Statistics. For each metro, the percentage change in home price between 2014 and 2019 was divided by the percentage change in median wage during the same time period.

Home price statistics are from the Zillow Home Value Index, which includes all single-family residences, condos, and co-ops. Wage statistics are from the U.S. Bureau of Labor Statistics Occupational Employment Survey, which includes all full-time and part-time wage and salary workers in nonfarm establishments. The data do not include self-employed workers, owners and partners in unincorporated firms, household workers, or unpaid family workers.

To identify metros with the largest increase in home prices relative to income over the past five years, researchers calculated the percentage change in home prices and the percentage change in median annual wages between 2014 and 2019. The percentage change in home price was then divided by the percentage change in wages. Locations were ordered by the resulting statistic. In the event of a tie, locations with the larger percentage increase in home price were ranked higher.

Here are the large metros with the largest increases in home prices relative to income.

15. Jacksonville, Florida

Jacksonville, Florida
Sean Pavone / Shutterstock.com
  • Increase in home prices relative to income: 3.1X
  • 5-year percentage change in home prices: 36.4%
  • 5-year percentage change in wages: 11.6%
  • Median home price (2019): $228,585
  • Median annual wage (2019): $36,770

14. Phoenix-Mesa-Scottsdale, Arizona

Phoenix, Arizona
Anton Foltin / Shutterstock.com
  • Increase in home prices relative to income: 3.1X
  • 5-year percentage change in home prices: 37.5%
  • 5-year percentage change in wages: 12.1%
  • Median home price (2019): $279,459
  • Median annual wage (2019): $39,420

13. Columbus, Ohio

Women in Columbus Ohio
Joshua Resnick / Shutterstock.com
  • Increase in home prices relative to income: 3.1X
  • 5-year percentage change in home prices: 38.4%
  • 5-year percentage change in wages: 12.2%
  • Median home price (2019): $206,561
  • Median annual wage (2019): $40,380

12. Kansas City, Missouri-Kansas

Kansas City
wallace-weeks / Shutterstock.com
  • Increase in home prices relative to income: 3.2X
  • 5-year percentage change in home prices: 36.4%
  • 5-year percentage change in wages: 11.3%
  • Median home price (2019): $201,466
  • Median annual wage (2019): $40,640

11. Grand Rapids-Wyoming, Michigan

Grand Rapids, Michigan
Henryk Sadura / Shutterstock.com
  • Increase in home prices relative to income: 3.3X
  • 5-year percentage change in home prices: 47.1%
  • 5-year percentage change in wages: 14.3%
  • Median home price (2019): $214,581
  • Median annual wage (2019): $37,410

10. Tampa-St. Petersburg-Clearwater, Florida

Tampa, Florida
Ilya Images / Shutterstock.com
  • Increase in home prices relative to income: 3.5X
  • 5-year percentage change in home prices: 48.9%
  • 5-year percentage change in wages: 13.8%
  • Median home price (2019): $224,850
  • Median annual wage (2019): $37,170

9. Detroit-Warren-Dearborn, Michigan

Detroit, Michigan
ehrlif / Shutterstock.com
  • Increase in home prices relative to income: 3.6X
  • 5-year percentage change in home prices: 41.8%
  • 5-year percentage change in wages: 11.7%
  • Median home price (2019): $179,796
  • Median annual wage (2019): $41,620

8. Atlanta-Sandy Springs-Roswell, Georgia

Gill Copeland / Shutterstock.com
  • Increase in home prices relative to income: 3.6X
  • 5-year percentage change in home prices: 42.4%
  • 5-year percentage change in wages: 11.7%
  • Median home price (2019): $236,369
  • Median annual wage (2019): $40,000

7. Nashville-Davidson-Murfreesboro-Franklin, Tennessee

Signs in Nashville, Tennessee
Joseph Sohm / Shutterstock.com
  • Increase in home prices relative to income: 3.6X
  • 5-year percentage change in home prices: 48.8%
  • 5-year percentage change in wages: 13.6%
  • Median home price (2019): $273,539
  • Median annual wage (2019): $38,900

6. Dallas-Fort Worth-Arlington, Texas

Dallas Cowboys fans
fitzcrittle / Shutterstock.com
  • Increase in home prices relative to income: 3.7X
  • 5-year percentage change in home prices: 50.4%
  • 5-year percentage change in wages: 13.5%
  • Median home price (2019): $250,511
  • Median annual wage (2019): $40,430

5. Sacramento-Roseville-Arden-Arcade, California

Adonis Villanueva / Shutterstock.com
  • Increase in home prices relative to income: 3.8X
  • 5-year percentage change in home prices: 35.2%
  • 5-year percentage change in wages: 9.4%
  • Median home price (2019): $419,012
  • Median annual wage (2019): $44,590

4. Salt Lake City, Utah

Salt Lake City, Utah
Joe Guetzloff / Shutterstock.com
  • Increase in home prices relative to income: 3.9X
  • 5-year percentage change in home prices: 46.9%
  • 5-year percentage change in wages: 12.1%
  • Median home price (2019): $372,843
  • Median annual wage (2019): $40,120

3. San Jose-Sunnyvale-Santa Clara, California

San Jose, California
mTaira / Shutterstock.com
  • Increase in home prices relative to income: 4.6X
  • 5-year percentage change in home prices: 36.3%
  • 5-year percentage change in wages: 7.9%
  • Median home price (2019): $1,149,093
  • Median annual wage (2019): $61,980

2. Charlotte-Concord-Gastonia, North Carolina-South Carolina

Charlotte, North Carolina
Kevin M. McCarthy / Shutterstock.com
  • Increase in home prices relative to income: 4.6X
  • 5-year percentage change in home prices: 40.3%
  • 5-year percentage change in wages: 8.7%
  • Median home price (2019): $230,443
  • Median annual wage (2019): $39,230

1. Las Vegas-Henderson-Paradise, Nevada

Syda Productions / Shutterstock.com
  • Increase in home prices relative to income: 6.8X
  • 5-year percentage change in home prices: 51.0%
  • 5-year percentage change in wages: 7.5%
  • Median home price (2019): $289,885
  • Median annual wage (2019): $35,660

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

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