Homebuyers looking for affordability in today’s tough housing market will find it in a rebounding Rust Belt city.
Pittsburgh has been named the most affordable city in the world (yes, world) by the Urban Reform Institute and the Frontier Centre for Public Policy. In a recent study from the two nonprofits, the Steel City edged out every other major metropolitan area globally. Two other U.S. cities — Oklahoma City and Rochester, N.Y. — tied for second.
The study determined housing affordability for middle-income households by comparing home prices to household incomes in 92 cities (and eight different countries) and then ranked them from most to least affordable.
The median listing price for a typical Pittsburgh home is $222,500, according to data from Realtor.com. That compares favorably to the national median listing price of $405,000.
Pittsburgh is seeing an increase in housing inventory, which means buyers have more options when it comes to their home search. Currently, there’s a two-month supply of homes for sale nationally, well below the six-month supply many experts consider "healthy." In Pittsburgh, though, new listings have increased by 30% month over month in the first two weeks of April, just in time for the spring buying season.
Competition isn’t as fierce in Pittsburgh as it is in other markets, either.
The median number of days a house sits on the market in Pittsburgh is 61 days; much longer than many U.S. cities. Houses in Denver, on the other hand, are scooped up after a median of 9 days on the market.
Housing affordability is an increasing issue for many potential buyers. After two years of near-record low rates, current mortgage rates now hover at 5.11% — the highest they’ve been since 2010.
Higher mortgage rates aren’t the only challenge facing buyers today. Home prices continue to increase by double digits compared to last year, with the median list price of a typical home reaching a high of $405,000 in March. Monthly mortgage payments have increased as well, averaging over $460 more for a typical home as of the first week of April.
Compared to the same time last year home prices in Pittsburgh have decreased by 13.7%.
The U.S. cities that round out the study's list of the most affordable housing markets are St. Louis, Cleveland, Cincinnati and Buffalo, N.Y. The city of Edmonton in Alberta, Canada and Glasgow, Scotland also made the top ten.
The three U.S cities that ranked the lowest in affordability are San Francisco, Honolulu, and San Jose, Calif., according to the two nonprofits.