San Francisco Home Buyers Need To Earn Nearly $200k: Study

SAN FRANCISCO, CA — A new study shows what anyone thinking of buying a home in San Francisco probably already knows. The city’s pricey real estate market topped the list for the highest income required to buy a home among the nation’s largest cities. Home buyers need to earn nearly $200,000 annually—and that’s if they’re not carrying any other outstanding debt—a SmartAsset study says.

The financial technology company’s study considered five factors in ranking the nation’s 15 largest metropolitan areas: median home values, property tax rates, down payments, homeowner’s insurance and other monthly debt payments.

Median home values in the nation’s 15 largest cities range from nearly $1.2 million in San Francisco to less than $170,000 in Philadelphia, Pa., according to SmartAsset.

The median home value for the metropolitan areas considered in the study was roughly $418,500.

In San Francisco, where the median home value is $1,195,700, SmartAsset estimates a 30-year monthly mortgage payment at an interest rate of 4 percent (after a 20 percent down payment) would be $5,533.

A San Francisco homeowner would need a salary of $184,442 to afford those monthly payments assuming they had no additional outstanding debt.

Those carrying debt will need to earn much more.

Homeowners with a monthly debt payment of $500 would need to earn $201,109, and those with monthly debt of $1,000 would need to earn close to $218,000.

In Philadelphia, a homebuyer earning $27,453 annually without additional debt can own a piece of the American Dream.

SmartAsset is a financial technology company offering free tools that aim to help consumers make informed decisions about homebuying, retirement and taxes, among other topics.

The full SmartAsset report can be found online.