The data looked at the nationwide trend of home prices outpacing income gains over the last four years.
DALLAS — Home buyers need to earn an income of $121,398 to comfortably afford a mortgage in North Texas, about $53,000 more than they needed in 2020, according to new data from Zillow.
The data looked at the nationwide trend of home prices outpacing income gains over the last four years. The income projections accounted for a 10% down payment and local home prices and median income levels.
The income needed to comfortably afford a home in the Dallas metro area was well above the national average of around $106,000, according to the data.
Dallas also ranked high among Texas metros; Houston and San Antonio buyers need an income of around $95,000, while Austin buyers need an income of around $149,000, according to Zillow.
Of the top five largest metros in the country, Dallas' income level ranked third behind Los Angeles ($279,250) and New York ($213,615). Chicago ($104,757) and Houston ($95,374) were ranked lower than Dallas among the country's largest metro areas.
Nationwide, the highest income level needed was in the San Jose, Calif., metro area, at $454,296.
Zillow officials pinpointed the needed income increase to higher home prices and mortgage rates - and said the solution is more inventory.
"Housing costs have soared over the past four years as drastic hikes in home prices, mortgage rates and rent growth far outpaced wage gains," Orphe Divounguy, a senior economist at Zillow, said in a press release about the data. "Buyers are getting creative to make a purchase pencil out, and long-distance movers are targeting less expensive and less competitive metros. Mortgage rates easing down has helped some, but the key to improving affordability long term is to build more homes."
We've seen these type of numbers before. Earlier this year, WFAA's Jason Wheeler highlighted the drastic uptick in income needed to buy a home in his Right on the Money segment.
The American Enterprise Institute issued a report analyzing five million first-time homebuyer sales in 60 of the largest metro areas in the country. In 2013, median home prices for a first-time buyer cost between 2.49 and 2.85 times their median annual income. By 2022, those median home prices had soared to 3.55-3.81 times buyers' annual median income.
FAQs
DALLAS — Home buyers need to earn an income of $121,398 to comfortably afford a mortgage in North Texas, about $53,000 more than they needed in 2020, according to new data from Zillow.
What salary do you need to live comfortably in Dallas? ›
According to an annual SmartAsset report, single adults living in Dallas, Plano, Irving, and Garland require a $91,770 yearly salary in order to live comfortably in 2024.
How much do you need to make to afford a house in Dallas? ›
It's becoming increasingly difficult to achieve the dream of owning a home in Dallas, as buyers now require an annual income of at least $121,398 in order to comfortably afford a mortgage. That's an increase of $53,000 from 2020, according to recent data from real estate website, Zillow.
How much income do you need to buy a house in Texas? ›
Here's how much annual income needed to afford a median-priced home in some of Texas' metro areas: Austin — Annual income needed: $126,208/Median home-sale price: $462,748. Dallas — $115,913/Median home-sale price: $425,000. Fort Worth — $98,185/Median home-sale price: $360,000.
How much income should you make to buy a house? ›
Now, Americans must earn roughly $106,500 in order to comfortably afford a typical home, a significant increase from the $59,000 annual household income that put homeownership within reach for families in 2020, according to new research from digital real estate company Zillow.
What is Dallas upper class salary? ›
As of Apr 25, 2024, the average annual pay for the Upper Class jobs category in Dallas is $53,717 a year. Just in case you need a simple salary calculator, that works out to be approximately $25.83 an hour. This is the equivalent of $1,033/week or $4,476/month.
What is a comfortable salary in Texas? ›
What's considered a “good” salary in Texas depends on your household size and lifestyle, but most Texans make between $45,000 and $100,000 annually. Texas cities have differing costs of living, of course — Austin is much pricier than Amarillo — so where you live in the Lone Star State also matters.
Is $80,000 a good salary in Dallas? ›
To live comfortably in Dallas, a good salary is about $80,000 annually. 80% of salaries in Dallas fall between $24,960 and $124,800 annually, so if you have a consistent, well-paying job, making a “good” salary is very much within your reach.
How much does it cost to live in Dallas per month? ›
In conclusion, for a single person, the Dallas cost of living average, for 2023 is estimated to be around $2,489 per month, covering various expenses like housing, utilities, insurance, taxes, and more. For a family of four, the average cost of living in Dallas TX is $5,949.
Can I afford a 500k house on 100k salary? ›
To afford a $500,000 house, you need to make a minimum of $91,008 a year — and probably more to make sure you're not house-poor and can afford day-to-day expenses, maintenance and other debt, like student loans or car payments. One good guideline to follow is not to spend more than 28 percent of your income on housing.
Texas has several homebuyer programs, and their eligibility requirements vary by program. In general, you need to fall into the low-to-moderate-income category and have a credit score of at least 620. According to Experian, the average credit score of Texas was 695 as of 2023, so many residents can qualify.
What is the average monthly payment for a house in Texas? ›
Homeowners in Texas pay $1,137 on average for a monthly mortgage payment. A home loan has many variables, though, which affect how much you could pay. Use MoneyGeek's Texas mortgage calculator to estimate how much you may pay monthly for a mortgage on a home.
What is the average down payment on a house in Texas? ›
According to the National Association of Realtors, the average down payment on a house for first-time homebuyers nationwide is 6%. Given that the median home price in Texas is $301,763*, that places the average down payment on a house in Texas at $18,105 for first-time home buyers.
How much house can I afford if I make $36,000 a year? ›
On a salary of $36,000 per year, you can afford a house priced around $100,000-$110,000 with a monthly payment of just over $1,000. This assumes you have no other debts you're paying off, but also that you haven't been able to save much for a down payment.
What credit score is needed to buy a $300K house? ›
The required credit score to buy a $300K house typically ranges from 580 to 720 or higher, depending on the type of loan. For an FHA loan, the minimum credit score is usually around 580.
Can I buy a house making 40K a year? ›
If you have minimal or no existing monthly debt payments, between $103,800 and $236,100 is about how much house you can afford on $40K a year. Exactly how much you spend on a house within that range depends on your financial situation and how much down payment you can afford to invest.
Is 70k a good salary in Dallas? ›
$47,500 is the 75th percentile. Salaries above this are outliers. $69,246 is the 90th percentile.
Can you live comfortably on 100k a year in Texas? ›
Individuals need roughly $100,000 to live comfortably on their own, and families of four need about $224,000.
Is 80k good in Dallas? ›
$80,422 is the 75th percentile. Salaries above this are outliers. $92,264 is the 90th percentile.
What is considered middle class in Dallas? ›
To be considered middle class in Austin, you'd have to make between $53,293 and $159,084, in Dallas between $38,857 and $115,990 and in Houston you would need to make between $37,184 and $110,998.
