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Getting Priced Out of Your Neighborhood

Posted by: Lisa Nichols | Apr 01,2008

Between the housing boom of a few years ago, and the struggle developers have to stay afloat today, more and more people are getting “priced out” of their own neighborhoods. While the news is full of information about homes that have dropped in value, in many areas home prices have continued to rise and people just can’t afford to buy a home. Forbes magazine recently rated the neighborhoods where new home buyers are being priced out due to the exploding average home prices. The Forbes survey makes it easy to see why many people can’t afford to buy a home in their own hometown.

 

Thinking of Moving to Alexandria, Virginia? You Might Want to Think Twice.

 

Alexandria, Virginia is one of the most expensive places to live in America. Though home prices have dropped by more than $30,000 since last year, housing prices here are still out of reach for many locals. The median price for a home in Alexandria, Virginia is $539,000- and the median salary for an Alexandria resident is $80,000.

 

New Home Buyer’s Woes in West Palm Beach, Florida

 

West Palm Beach, Florida also made Forbes’ list of unaffordable housing prices. New home buyers in this tony suburb are aghast at the median home price of $318,000- especially since the average salary for the town is $45,000! Homes in West Palm Beach, Florida have dropped by more than 10% in the last year. But new home buyers are still recovering from sticker shock- the median price for a home ten years ago was $72,000.

 

More Neighborhoods Where Many Can’t Afford to Buy a Home

 

Forbes listed a number of additional high-end areas where most locals can’t afford to buy a home. Included in the list is Cambridge, Massachusetts, where the median income is $51,000- and the average home price is a whopping $587,000. Passaic, New Jersey also has a huge discrepancy between median salary- $29,000- and the average price for a new home: $385,000. That’s a 70% increase from the price to buy a home just five years ago. Santa Monica, California rounds out the list, with homes selling for just over a $1 million and a median income of $61,000.

 

It’s pretty easy to see how people can quickly get priced out of their own neighborhoods. If you plan to become a new home buyer this year and can’t afford a home, consider moving high interest debt to a low interest credit card. You’ll reduce the amounts that you owe and a steady payment history might also improve your credit score- and decrease your new home loan interest rates. 

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