Breaking News
More () »

You must earn six figures to afford the typical home in the US, report shows

Americans must earn $107,000 to afford a "typical" house, according to a report from Redfin. These tips can help lower your monthly house payment.

CHARLOTTE, N.C. — It's no secret that the housing market is tough for those looking to buy a home, and now a new study shows it could be even harder. 

A new report from Redfin found that U.S. buyers need to make 45% more than they did last year just to afford a so-called "typical" house. So how can homeowners reduce their monthly mortgage payment? 

Let's connect the dots

Redfin's report found that American buyers must earn $107,000 a year to afford the median monthly mortgage payment. That's 45% higher than this time last year. 

A typical mortgage will cost you around $2,600. For an average 30-year fixed mortgage, you're looking at $2,682 per month. 

And while home values have softened in some parts of the country, the average sale price is up from a year ago. That means higher mortgages for those trying to own their first home. 

So what can you do? Experts say there are a few ways you can reduce your monthly house payment. 

A higher down payment means a smaller mortgage and lower monthly payment. If you don't have the cash up front, you can get an adjustable-rate mortgage. 

Adjustable-rate loans offer a lower initial rate before adjusting to the market later on. At the end of the day, housing industry experts say to choose the option that's right for you. 


Before You Leave, Check This Out