The U.S. cities where single buyers need a six-figure salary to buy a 1-bed home

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 A new study by sleep and wellness publication, eachnight, has found young, single professionals are being priced out of the housing market in major U.S. cities.

The share of U.S. homeowners who are single is on the rise, hitting a record 38 percent in 2018. But so too are house prices, which are growing at double the rate of the average worker’s salary, leaving young, single professionals with difficult decisions to make about their careers.

To find out where single professionals are being priced out of the housing market, the data analysts at eachnight reviewed the average cost of studio apartments and 1-bed homes in 25 of the most populated U.S. cities on Realtor.com and compared these against the average regional salary.

In four cities – San Francisco, New York, Boston and San Jose – single buyers need a six-figure salary to buy a 1-bed home which makes getting on the property ladder near impossible, especially as only 9 percent of the U.S. population earns over $100,000 a year:

The average cost of a 1-bed home in San Francisco is now a staggering $891,332, meaning a single professional must earn over $178,000 a year to afford it. To put this into perspective, this is $532,992 over budget based on what the average local worker can afford.

In New York, the average single buyer needs to earn $78,780 a year to afford a studio apartment or $142,383 a year for a 1-bed property.

In Boston, it’s $105,578 and $133,351 respectively. And in San Jose a single buyer needs an annual salary of $108,198 for a studio. This increases to $111,803 for a 1-bed.

The picture isn’t as bleak in the rest of the country, though. The most affordable city for a 1-bed home is Jacksonville – where workers need a modest annual salary of $29,135.

Jacksonville Business Journal reports more people are moving to the area for a suburban lifestyle in a more affordable market. Recent research supports this, showing Jacksonville is one of the more affordable places to own a home in the U.S. While average salaries are lower than the national average, this is offset by cheaper property prices.

The jobs market in Jacksonville is also growing above the national average; in 10 years it’s projected the city will have 14 percent more job opportunities, compared to 7 percent growth U.S-wide.

On top of Jacksonville offering the most affordable 1-bed homes, studios in the city require buyers to earn just $12,824. Cities that closely follow Jacksonville for the lowest required annual salaries for 1-beds are Tucson ($29,339), Dallas ($33,949) and Milwaukee ($37,185).

While studio apartments can be limiting and uncomfortable without separate living and sleeping spaces, especially as more people work from home, in some U.S. cities the cost to upgrade to a 1-bed property isn’t feasible for single buyers.

In fact, the average cost to upgrade is a staggering $341,325 in San Francisco. In New York, it’s $318,016, Indianapolis $160,046, Washington $156,348 and Philadelphia $152,501:

The picture is different in Dallas, Fort Worth, Detroit, Houston and Tucson, where 1-bed properties are on average cheaper than studio apartments:

Jasmin Lee, Editor at eachnight commented on the findings:

Our study reveals the growing financial burden on single professionals trying to get on the property ladder in some U.S. cities. Many young people must make a difficult choice between owning a home and growing their careers. Unfortunately, some of the cities with more diverse job opportunities require six-figure salaries if you want to get on the property ladder there.

“Ultimately, there may be some cities that see a talent drain, affecting businesses across all sectors, as young professionals decide to relocate to more affordable areas.”

Looking to get on the property ladder? Try this real estate affordability calculator here.