Home affordability breakdown: What does Midland have on Malibu?

In West Texas, the typical home costs only three times as much as the typical income. But in some California markets, that ratio triples.

These and other fascinating facts emerged when The Real Deal analyzed Zillow and Census data for 300-plus U.S. metropolitan areas to see how income and home prices compare.

As one might expect, the higher the per capita income in an area, the higher the median home price. But relative to income, homes cost several times more in some markets.

This is one of the hundreds of data sets available on TRD Pro — the one-stop real estate terminal for all the data and market information you need.

Of the 348 major metropolitan areas, California’s San Jose, Sunnyvale and Santa Clara market has the highest combined median home sale price, $1.35 million, and the highest per capita income, $136,300.

At the other end of the financial spectrum is the area of Edinburg and Mission, Texas, hard by the Mexico border, median home price is among the lowest at $210,900, as is per capita income, $34,500. But the ratio is about 6 to 1, versus 10 to one for Silicon Valley.

Zooming out shows the variation across the four regions of the continental U.S.

The median sale price in Midwest metro areas is the lowest at $214,000, followed by the South at $255,900. Those regions also have the lowest collective average personal incomes: $55,600 and $54,400, respectively.

The West and Northeast have higher average annual incomes at $60,700 and $62,700, respectively. The median home sale price in their metropolitan areas is $278,500 in the Northeast and $441,400 in the West.

Affordability can be gauged by showing income as a percentage of home price. Spoiler alert: Californians pay through the nose, a result of high demand to live there and restrictions on housing construction and turnover.

Across the metropolitan areas in this study, per capita income is 21 percent of median home price. But it’s far lower in the West.

Affordability is especially bad in California’s Santa Cruz, Salinas, Los Angeles, Long Beach, Anaheim, San Diego, Chula Vista, San Bernardino and Napa, where the average annual income is less than 10 percent of the median home price.

The Miami-Fort Lauderdale-Pompano Beach area also ranks among the least affordable.

The Midwest and South are the most affordable. In places like Danville and Carbondale, Illinois, and Cleveland and Toledo, Ohio, incomes are typically 30 percent or more of median home prices.

The ratio is also attractive in places like Midland, Texas, where the per capita income is $125,500 but median home price is just $315,700. That can be a result of high-paying oil industry jobs in hot, dusty towns with modest homes and limited amenities.

Contrast that to Los Angeles, Long Beach and Anaheim, where fat wallets and high credit scores are homebuying prerequisites. Per capita income there is $75,800 but residents need to pay more than 11 times as much — $867,700 — for a typical home.