Ever since the pandemic, housing prices and mortgage rates have both boomed. The combination has kept the housing market at near-record levels of unaffordability in 2024.
Nationwide, the median existing home price was $422,600 as of July 2024, a 4.2% increase from the year prior. Although the Fed has recently begun cutting interest rates, that may actually help propel prices higher, potentially negating any savings from reduced mortgage rates.
While this may be dispiriting news for potential homebuyers, there are rays of light scattered across the country. While high prices garner all the headlines, there are actually seven well-known cities in America where you need less than $10,000 saved to cover a 6% down payment. Here they are, in order from most to least affordable.
Detroit
- Savings needed for a 6% down payment: $4,260
- Annual mortgage with a 6% down payment: $5,046
- Salary needed to afford a mortgage with a 6% down payment: $16,820
Detroit is currently the most affordable large housing market in America. Even a 20% down payment would require only $14,199 in savings. With a 20% down payment, the monthly payment of just $358 requires a salary of only $14,316 to be affordable.
Cleveland
- Savings needed for a 6% down payment: $6,476
- Annual mortgage with a 6% down payment: $7,671
- Salary needed to afford a mortgage with a 6% down payment: $25,572
Cleveland is the home to the Rock & Roll Hall of Fame, the Pro Football Hall of Fame and extremely affordable housing. A 10% down payment would require just $10,794.
Toledo
- Savings needed for a 6% down payment: $7,181
- Annual mortgage with a 6% down payment: $8,507
- Salary needed to afford a mortgage with a 6% down payment: $28,357
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The average home price in Toledo comes in at a scant $119,690, meaning homes are affordable even with a 6% down payment. With a “full” down payment of 20%, the monthly mortgage cost would be just $603.
Birmingham
- Savings needed for a 6% down payment: $7,475
- Annual mortgage with a 6% down payment: $8,855
- Salary needed to afford a mortgage with a 6% down payment: $29,516
Birmingham is one of two Southern cities on the list, representing another area of the country that is traditionally more affordable. After a 10% down payment of $12,459, residents earning just $28,260 could afford the annual mortgage of $8,478.
Akron
- Savings needed for a 6% down payment: $7,848
- Annual mortgage with a 6% down payment: $9,297
- Salary needed to afford a mortgage with a 6% down payment: $30,989
Home values in Akron average just $130,801, meaning a 10% down payment would cost you just $13,080. That translates to a monthly payment of just $742.
