By Christina Sturgis
Cincinnati, a major city 80 miles north of Frankfort in Ohio, the Buckeye State, is 2nd in HSH’s latest list of major cities ranked by the salary required to buy a home, but a careful look suggests a Kentucky home may be a better bargain.
The mortgage publisher compared mortgage rates and home prices for 25 cities and found that a home valued at $128,000 with a mortgage at 4.45 percent would cost $22,226.95 per year in salary, a better bargain than any other city on the list, except Cleveland. HSH is calculating only the principal and interest, not the property taxes, homeowners insurance and private mortgage insurance.
The range of city to salary is very wide. The Cleveland example is a home priced at $112,800 with a mortgage at 4.43 percent topping the list in affordability with an annual cost of $19,435.17, according to HSH. The least affordable city featured is San Francisco with a $682,410 house and a 4.28 percent mortgage. Even with recent reductions in interest rates and home prices, the City by the Bay would cost $114,510.06 per year in principal and interest.
HSH elected not to factor property taxes into its comparisons different taxing systems are hard to compare fairly. The not-for-profit and non-partisan Tax Foundation, however, compares property taxes from state to state by totaling the taxes collected and dividing the amount by the population.
On this scale, Kentucky is more affordable than Ohio. The Blue Grass State charges $689 per capita in property taxes compared to $1,140 for Ohio. California charges $1,426 per capita and the No. 1 state for property tax burden is New Jersey, charging $2,893 per capita.
If these figures have considering purchasing some real estate, a ranch home in Frankfort is listed at $104,900. Zillow estimates with a down payment of $20,980 the monthly payment would be $533 for principal, interest, property taxes and homeowners insurance.