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Where To Find 2015’s Most Affordable Cities

Published on Thursday - March 26, 2015

Headlines of appreciation have dominated media outlets for the better part of three years. Popular coastal destinations have seen home values return to pre-recession levels. Boston and San Diego, in particular, have seen prices in the housing sector increase almost exponentially. Subsequently, rents in these metropolitan areas have kept pace with growing values. It is hard to deny that the prospect of buying a home is becoming increasingly distant for a large population of the American people. However, there are select areas that defy the trends exhibited by these expensive locales. In fact, there are a host of Midwestern and Southern cities that promote the idea of affordability. If the cost of housing continues to burden your home searches, recognize that there is still affordable housing to be had.

To find the most affordable cities, Forbes started with America’s 100 largest Metropolitan Statistical Areas (MSAs) and Metropolitan Divisions (MDs)—cities and their surrounding suburbs. Using numbers from the fourth quarter of 2014, affordability was assessed.

Living costs are relative to a specific region, as $100,000 will get you a lot more in a city like Birmingham than San Jose. The median household income in Birmingham, for example, is approximately $61,000, almost $3,000 shy of the national average. However, the cost of living in Birmingham is much lower than most cities. According to Forbes, “during the fourth quarter of 2014 the median sales price for a home was $130,000, and about 81.5% of homes were affordable to families bringing in the area’s median pay. Paychecks stretch further all around: groceries cost about 5.4% less in Birmingham than the national average, transportation about 13.2%, and health care 16.6%.”

Of course, Birmingham is far from the only affordable city. The Midwest and Southern regions of the United States are actually home to a bevy of affordable cities. As a comparison, only two metros outside of these areas found themselves on the list of most affordable cities: Colorado Springs and Buffalo. Not surprisingly, the West Coast didn’t contribute one city to the most affordable list. California is actually home to 4 of the 5 most unaffordable cities – the only exception being Honolulu.

Three of the top five most affordable cities come from the South: Birmingham, Knoxville and Oklahoma City. However, not to be outdone, the Midwest had a strong showing of cities too. In fact, eight of the top 15 most affordable cities were in the Midwest – half of which were in the state of Ohio alone.

According to the data collected by Forbes, the following cities represent the most affordable metros in the country:

  • Birmingham: 81.5 percent of homes are affordable to those families making the median household income.
  • Knoxville: 79.2 percent of homes are affordable to those families making the median household income.
  • Buffalo: 81.8 percent of homes are affordable to those families making the median household income.
  • Oklahoma City: 77.3 percent of homes are affordable to those families making the median household income.
  • Cincinnati: 83.9 percent of homes are affordable to those families making the median household income.
  • Memphis: 72.4 percent of homes are affordable to those families making the median household income.
  • St. Louis: 85.9 percent of homes are affordable to those families making the median household income.
  • Dayton: 86.2 percent of homes are affordable to those families making the median household income.
  • Indianapolis: 79.4 percent of homes are affordable to those families making the median household income.
  • Columbus: 69.4 percent of homes are affordable to those families making the median household income.

In establishing this list of America’s most affordable cities, Forbes considered cost of living using an index developed by Sperling’s Best Places, which measures the cost of food, utilities, gas, transportation, medical expenses, and other daily expenses in each area.

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