2020 Most Affordable Housing Markets

One of the biggest changes of 2020 has been the geographic shift of Americans to more affordable housing markets across the United States.

According to an analysis from the change-of-address data provided by the United States Postal Service, America saw 15,974,826 people file for new addresses from February 2020 to July 2020.[1]

This figure represents a 4% change in total movers from 2019 and a 27% increase in temporary movers.

Whether due to facilities closing, certain city protocols not being safe enough, or housing one can no longer afford, around one-in-five U.S. adults say either they changed their residence or know someone who did.[2]

In addition to the mass migration of Americans, there has been a monumental shift in people working from home, for the foreseeable future.

Salaries are yet to catch up to the adjusted cost implications companies face as they adjust to their new operating environment.

Check our analysis on the Coronavirus for more information on the economic impacts, HERE!

The more savvy Americans are seeking to relocate to cities where they can get the most bang for their buck.

Ranking Criteria of the Most Affordable Housing Markets

Analyzing the “Most Affordable Housing Markets” is difficult to put into action, as it completely eliminates the subjectivity of deciding where one chooses to live. Americans are drawn to cities for more than just jobs and cost-of-living levels.

Families, friends, and organizations are, more times than not, driving factors in individuals’ place of living.

For the sake of this analysis, Roofstock’s rankings will be utilized. Roofstock took a combination of the following parameters in developing their rankings:[3]

  • Median Annual Salary
  • Median Home Price
  • Share of Income Spent on Housing
  • Unemployment Rate

There are plenty of other studies coving the same topic, however, they merely scratch the surface on the true drivers of an “Affordable Housing Market!”

CNBC, for example, released “5 U.S. Cities with the Most Affordable Homes Under $100,000.” Without digging into the article, one would expect mid-size cities with strong housing markets to dominate their list.

However, Chicago took home the number one spot… How? According to Realtor.com’s analysis of the 125 most populous cities, Chicago touted the highest number of listings under $100,000. Therefore, CNBC determined Chicago as “the top American city with he most affordable homes.”

CNBC did not account for any employment statistics, cost-of-living analysis, or current job market conditions!

With CNBC’s weak analysis aside, let’s dive into Roofstock’s!

1. Des Moines, IA

  • Median Annual Salary: $49,420
  • Median Home Price: $181,217
  • Share of Income Spent on Housing: 24%
  • Unemployment Rate: 2.9%

As expected before writing this article, the most affordable housing markets should be comprised of mid-sized, working-class cities.

Ranked #5 by US News for “Places to Live,” Des Moines boasts a strong job market, strong history of hard work, and a diverse economy.

Paired with a housing cost nearly $50.000 below the national average, those seeking to move out of the major U.S. cities to more affordable, mid-size cities should consider Des Moines!

Minneapolis-St. Paul, MN

  • Median Annual Salary: $55,010
  • Median Home Price: $237,367
  • Share of Income Spent on Housing: 25%
  • Unemployment Rate: 3.3%

As opposed to Des Moines, Minneapolis-St. Paul is a dominating hub in the United States.

As the 16th largest city with 60% of the state’s resident calling “MSP” home, there are exponentially more job opportunities than Des Moines, IA.

17 of the Fortune 500 companies maintain their headquarters in the MSP region.

However, there are also big city problems that come along with that.

For years to come, Americans will hear “Minneapolis” and immediately make the connection to George Floyd and the violence that ensued in the summer of the 2020.

For those seeking a large, U.S. city for relocation, Minneapolis provides a relatively affordable housing market with an emerging job scene.

Salt Lake City, UT

  • Median Annual Salary: $46,221
  • Median Home Price: $280,894
  • Share of Income Spent on Housing: 25%
  • Unemployment Rate: 3.1%

Familiar to most for their participation in the Winter Olympics back in 2002, Salt Lake City consistently supports a strong job market and ideal outlet for those seeking exodus from California.

According to the U.S. Bureau of Labor Statistics, Utah ranked #1 for total job growth (+3.6%) and #1 for private-sector job growth (+4.0%).

Additionally, the 2020 Utah Economic Report to the Governor showed the state maintaining a 3.0% long-term average for annual job growth.[4]

If those statistics are not enough of a compelling argument, the work-life balance for those seeking outdoor activities is unmatched…

Boise, ID

  • Median Annual Salary: $43,040
  • Median Home Price: $221,475
  • Share of Income Spent on Housing: 26%
  • Unemployment Rate: 3.0%

The stats on Boise, Idaho are astonishing; according to Business Insider, 194% more people moved into Idaho than out since March, its been called “The Best Place for Millennials to Live in the US,” and it was the fastest going city in the US in 2018.[5]

The statistics speak for themselves. There’s a reason 26% of the 80,000 Idaho migrants were from California.

For millennials, especially, Boise, Idaho has a unique way of attracting Americans through their growing culture and tax-friendly economy.

Omaha, NB

  • Median Annual Salary: $46,490
  • Median Home Price: $165,667
  • Share of Income Spent on Housing: 25%
  • Unemployment Rate: 3.0%

Last but not least, why not move to share the same city as the Oracle of Omaha? In a city where residents typically keep more than 71% of their income in their wallets,[6] there are big-city job opportunities with a small country feel.

In fact, Omaha was recently dubbed, “Silicon Prairie,” for their accommodations for new business.

Curious about how business is handled in Omaha? Check out our analysis HERE!

The American Dream

For those seeking to relocate, the cities listed provide an objective view of the most affordable housing markets in America that offer a strong foundation to leverage growth.

However, the social issues running across America were not tied into this analysis (crime rates, deficits, and infrastructure).

There are countless factors that go into the decision to relocate.

However, as most of the entertainment industry is at a standstill, now is the time to objectively compare cities to determine where individuals can best leverage their abilities and buying power to create a better future for the next generation.

If you’re curious on how much you should be spending on house payments, check out our personal budget analysis, HERE!

Article Sources:  

  1. My Move. “Coronavirus Moving Study: People Left Big Cities, Temporary Moves Spiked in First 6 Months of COVID-19 Pandemic
  2. Pew Research Center. “About a Fifth of U.S. Adults Moved Due to COVID-19 or Know Someone Who Did
  3. Roofstock. “7 Expert Lists Showcasing the Cheapest Housing Markets of 2020
  4. Woodley. “Why so Many People are Moving to Salt Lake City
  5. Business Insider. “I talked to 3 millennials who gave up big-city lives in California and moved to Boise. Here’s how they feel about adjusting to small-town life in Idaho
  6. The Dodge Voice. “12 Reasons You Should Consider Moving to Omaha