Study: Average Honolulu resident would have to save for 40 years to afford a home
HONOLULU, Hawaii (HawaiiNewsNow) - A new study underscores just how out of reach homeownership is for many Honolulu residents.
The report looked out how long someone bringing in the median income would have to save in order to make a down payment on a median-priced home.
The answer for Honolulu: 40 years.
That’s four decades ― just to squirrel away enough money for a 20% down payment.
Urban Honolulu tied with San Francisco for the second-longest length of time a prospective homeowner would have to save up. Los Angeles was in the top spot ― at 43 years.
The report, from homeownership investment company Unison, found that on average across the country it would take 14 years to save up enough for a 20% down payment.
But a number of large cities were well above that.
In New York City and Miami, someone at the median income would have to save up for 36 years. Residents in San Diego and San Jose would be saving for 31 years.
The report is based on a median household income for Honolulu of $71,236, and a median home price of $717,000. The median means half of homes are more expensive and half of homes are cheaper.
The U.S. cities were you’d have to save for the shortest length of time: Detroit (seven years), Wichita, Kansas (11 years) and Columbus, Ohio (12 years).
The report also tracked affordability over time.
In Honolulu, for example, median home values went up by 48% from 2013 to 2018. But the median household income has only gone up by 23% over the same period.
“Today’s least affordable cities became even further out of reach for aspiring homeowners over the last five years,” the report said. “In top-ranked Los Angeles, home values increased by 59%, while incomes lagged far behind at only 23% growth.”
Meanwhile in Honolulu, the amount needed for a 20% down payment grew from $97,000 in 2013 to $143,000 ― a difference of $46,000.
And the report puts the median monthly house payment in Honolulu at $3,500 ― up from $2,200 in 2013. To afford that payment, the report said, a household would have to bring in $140,000 a year.
Unison Affordability-Report... by on Scribd
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