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Another way to look at America’s least affordable housing markets

Single family homes for sale are seen in San Marcos, California.
Reuters/Mike Blake
A bargain?
By Zainab Mudallal
Published Last updated This article is more than 2 years old.

News flash: houses in Silicon Valley are expensive. Really expensive.

The latest report by real estate agent Coldwell Banker on prices of family homes found across the US found, for the second time in three years, that the average house in Los Altos, California, is the priciest in the country, at nearly $2 million.

Coldwell Banker’s annual report compares four-bedroom, two-bathroom homes of a similar size across nearly 2,000 cities. Property markets in and around Silicon Valley are prominent at the top of the rankings, a source of angst for residents priced out of the tech cluster.

For the same price as a place in Los Altos, a buyer could get no fewer than 30 homes in Cleveland, the cheapest market tracked by Coldwell Banker—a different one for just about every day of the month. (Quartz did some similar calculations last month, with equally eye-opening results.)

Few will argue that Silicon Valley’s property market is anything but frothy, but affordability is in the eye of the beholder. The average household in Los Altos makes more than $235,000 a year, according to the latest Census Bureau figures. Although the typical four-bedroom house in the city is more than eight times larger, the gap is even bigger as you travel closer to San Francisco (including within the city itself) and down the coast to areas like Santa Barbara, near Los Angeles:

By contrast, in the well-to-do Chicago suburb of Winnetka and hedge fund-heavy enclaves of Greenwich and Westport, Connecticut, near-million dollar homes are only around three-to-four times the average family’s income. That ratio is about the same as in Lithonia, Georgia and Scranton, Pennsylvania, which are among the cheapest housing markets in the country:

So while it goes without saying that homes in Silicon Valley and Southern California are less affordable than in places like Scranton and Cleveland, that doesn’t mean that buying a house in some of the cheapest housing markets—according to sticker prices—is that much easier for the people who actually live and work there.

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