Housing affordability: How does the Twin Cities rank?

Okay, we know that Joe Mauer will have no trouble affording rent or a mortgage payment for at least the next eight years, but how are people in other occupations faring in the Twin Cities?

The Center for Housing Policy just released its Paycheck to Paycheck report, which looks at housing affordability for U.S. workers. The report compares  the wages for more than 60 occupations to home prices and rents in over 200 metropolitan areas. This year's report highlights the housing challenges for workers in the green economy. 

Despite an increase in the fair market rent, the Twin Cities become more affordable when compared to other metro areas. In a ranking of most to least expensive rental markets, the Minneapolis/St. Paul metro area ranks 80th out of 210 rental markets. In 2008, the Twin Cities metro was the 69th most expensive rental market. A retail salesperson or janitor in the Twin Cities does not earn enough to afford a two-bedroom rental unit. Elementary school teachers, police officers and nurses (LPN) do.

The annual income needed to buy a home in Minneapolis/St. Paul dropped from $59,458 in 2008 to $50,746 in 2009. The Twin Cities ranks 80th in homeownership affordability out of the 208 metro areas in the study. The median-priced home is affordable for an elementary school teacher or police officer earning an average wage in the Minneapolis/St. Paul metro area. Homeownership is not affordable for LPNs, retail salespeople, or janitors.

Here are the key findings for the U.S. in this year's report:

• Although  home prices were relatively stable in two fifths of the metro areas in the study, the income needed to purchase a home dropped in almost all areas due to lower mortgage interest rates.
• Rents have increased in many metro areas and have occasionally surpassed monthly mortgage payments for a median priced home.
• Housing affordability has not dramatically improved for traditional community workers, such as police officers, elementary school teachers, nurses, janitors, and retail workers. These key workers often cannot purchase a median-priced home and, in some cases, cannot afford the fair market rent for an apartment. 

About the Center for Housing Policy:
The Center for Housing Policy is the research affiliate of the National Housing Conference. The Center specializes in developing solutions through research. In partnership with NHC and its members, the Center works to broaden understanding of the nation’s housing challenges and to examine the impact of policies and programs developed to address these needs.