Most of us reading this can afford to survive in expensive coastal cities; drawing conclusions about the affordability of middle American cities based on the ex

Most of us reading this can afford to survive in expensive coastal cities; drawing conclusions about the affordability of middle American cities based on the experience of the top quintile is a very bad way to reason about these things. A much more fruitful way is to use actual numbers. So let’s do that. The minimum down payment for most mortgages is 3.5%, which yields a mortgage payment of $635 at today’s rates, according to Zillow. This includes P&I, PMI, taxes, and insurance. So far so good. The maximum recommended amount of your monthly take home your mortgage should be is 28%. If we follow this recommendation then our hypothetical family needs to bring home $2,267 after tax to guarantee that their mortgage is no more than 28% of their monthly budget. $2,267 works out to $13.07 per hour for one person fully employed, or $6.53 for two people. So yes, it’s technically possible at most minimum wages, but boy are those margins slim. I think the biggest issue here is that assuming that both members of the household can maintain perfect full time employment forever in an area where houses are that cheap is a really dangerous assumption to make.