Here's how much first-time buyers must make to afford typical US starter home

DENVER — Buyers must earn nearly twice as much as before the pandemic to afford the typical starter home.by Redfin said homebuyers must earn $75,849 annually to afford the typical U.S. starter home, as of February. Redfin said that figure is up 8.2% or $5,767 from a year earlier.

Redfin determined buyers must earn nearly twice as much as before the pandemic to afford the typical starter home, due to high prices and mortgage rates. The monthly housing payment for the typical U.S. starter home was $1,896 in February, also up 8.2% from a year earlier,The typical starter home sold for $240,000 in February, up 3.4% year over year, and the average 30-year fixed mortgage rate was 6.78%, up from 6.26% a year earlier.

Americans needed to earn $40,465 annually to afford the typical U.S. starter home in February 2020, when the median sale price was $169,000 and the average mortgage rate was about 3.5%, theIncomes are rising, but at less than half the rate of starter-home costs. According to the report, the typical American household earns an estimated $84,072, up 5.5% from February 2023 — versus the 8.2% increase in income needed to buy a starter home.

Also, active listings of starter homes rose 7% annually in February, the biggest increase in at least a decade.

Source: Loan Digest (loandigest.net)

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