The general rule of thumb used to determine if you can afford to buy a house is if the price is roughly equivalent to 2.6 years of your household income. The average housing price in Salt Lake City right now takes about 4.5 years of income to afford.
Citylab lists the most unaffordable markets in the U.S. Salt Lake City is the 20th least affordable. Salt Lake trails behind more expensive metros like San Francisco, San Jose and Los Angeles.
Least Affordable Metros
|Metro||Years of Median Household Income to Buy Median Home|
|Salt Lake City||4.5|
Housing affordability is a function of both housing prices and incomes. While it is true that incomes are higher in more expensive cities, prices are higher still. Higher productivity in these places does lead to higher wages, but they’re still not enough to meet the increased cost of housing. (Our analysis covers the price of the median home; housing prices are much, much higher in certain neighborhoods in these cities and metro areas.)
As a growing chorus of urban economists has pointed out, the problem of housing affordability in expensive cities is due to land-use restrictions and NIMBYism, which are choking housing supply, as well as a lack of funding for affordable housing. And even though taller buildings are rising in many downtown cores, virtually no housing has been added to older inner suburbs in the past half-century.
The 10-most affordable housing markets in the study are all east of the Mississippi River.