How Charlotte's homebuying power compares to the 1970s
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Homebuying power in the Charlotte area decreased 49.3% from 1970 to 2022, per Axios' Rahul Mukherjee's analysis of a new RealtyHop study.
- Homebuying power is the ratio of annual income versus the average house price in 1970 (when boomers started buying starter homes) compared to 2022.
Why it matters: Buying a house is far less accessible today than it was for previous generations.
By the numbers: The average Charlotte-area home cost $16,300 in 1970, and a family's median income was $9,564, according to the study. Home values in the area climbed to $312,800 by 2022.
- But the median income of $93,023 hasn't kept pace.
Zoom out: North Carolina's other major metros, including Durham and Raleigh, have also been impacted over this period.
- Durham's homebuying power dropped 45.1%. The average home was valued at $14,800 in 1970, and the median family income was $8,194. As of 2022, the homes in the area were valued at $316,600 and the median income was $96,231.
- Raleigh's homebuying power decreased 41.5% Homes were valued at $19,700 in 1970 and the median income was $10,085. Homes are valued at $347,000 as of 2022, with a median income of $103,882.
The big picture: The largest affordability gaps are along the West Coast, with all five of the least affordable cities in California.
- Meanwhile, the Midwest has remained the most affordable region for homebuyers. Of the 117 cities included in the study, Detroit is the only one where buying is easier today than it was 50 years ago.
Reality check: Mortgage rates were in the double digits in the 1970s and '80s. Today they're hovering around 7%.
The bottom line: Many first-time buyers are stuck on the sidelines.
- "You have to be a high-income earner/dual household" to buy in this market, North Carolina agent and first-time buyer specialist Jeff Clay told Axios.