Homeownership is becoming more expensive, and it’s not just because home prices are rising. Mortgage payments are one of the largest costs of owning a home, and with today’s higher interest rates, average monthly payments are far above where they were a decade ago.
Over the last ten years, the average monthly mortgage payment in every major U.S. city has at least doubled, while average annual incomes have grown at a much slower pace. The result is tighter budgets for families and longer timelines for first-time buyers trying to save enough to purchase a home.
Zoocasa analyzed median single-family home prices from May 2014 to May 2024 in 50 U.S. cities and calculated the average mortgage payment in each. The calculations were done assuming a 20% down payment and using the 30-year fixed rate from the first week of May of each year analyzed, according to Freddie Mac. We then compared this to the average annual income according to the U.S. Bureau of Labor Statistics in each city to see how the rates of growth differ from 2014 to 2024.
The average 30-year fixed rate in the first week of May 2014 was 4.29% and the average 30-year fixed rate in the first week of May 2024 was 7.22%.
In some cities, average mortgage payments haven’t only doubled, they’ve tripled. From 2014 to 2024, the average mortgage payment increased by over 200% in 17 cities. This includes both affordable markets like Buffalo and expensive metros like Miami, showing that whether you live in the Rust Belt or the Sun Belt, there’s nowhere to hide from rising homeownership costs.
Tampa home buyers in 2024 faced the biggest shock. In 2014, the average mortgage payment was just $617, but by 2024 it had jumped 257.2% to $2,204. While that isn’t the highest payment in the country, it represents the steepest percentage increase. Over the same period, Tampa’s median home price rose from $156,000 to $405,000, while incomes grew only 48.2%. This left a widening gap between what homes cost and what buyers earn.
The other cities rounding out the top five for the steepest percentage increases in average monthly mortgage payments are Las Vegas (240.2%), Orlando (240.1%), Grand Rapids (238.2%), and Salt Lake City (234.2%). While none of these markets are typically seen as the most expensive in the country, the pace of growth has made them harder for local buyers to keep up with. Even after these jumps, they remain more affordable than markets like San Francisco or New York, but the rapid rise is steadily pushing them out of reach for many residents.
These increasing costs wouldn’t be so shocking if incomes had equally risen over the past decade. Unfortunately, they haven’t. Income growth ranged from 30% to 60%, with the average across all 50 cities at 42.4%.
Why You’ll Need an Extra $30K a Year to Afford a Mortgage in 2024
Many households now face mortgage costs that are about $2,000 higher per month than they were in 2014. But in most markets, incomes haven’t kept pace, leaving buyers struggling to cover the gap.
Take Boston, for example. Since 2014, the average monthly mortgage payment has risen by $2,963, which adds up to an extra $35,556 a year. Over the same period, average annual incomes in Boston have grown by only $23,030 — leaving nearly a $12,000 shortfall between rising housing costs and income growth.
Not surprisingly, the cities that now require the most extra mortgage money each year are also the most expensive markets. In San Jose, homeowners pay an additional $96,915 annually compared to 2014. In San Francisco, the difference is $56,590, while in San Diego it’s $43,001.
At the other end of the spectrum, Cleveland is the only city where homeowners need less than $10,000 more for mortgage payments than they did in 2014, with the increase coming to $9,823.
San Jose’s average annual salary increased by 59.9% from 2014 to 2024—the highest of all 50 cities analyzed—and is one of the wealthiest cities in America. In 2024, the annual average income was $121,160, which is double that of Orlando, Louisville, and Virginia Beach.
But with the median single-family home costing over $2 million, even a 60% salary bump cannot keep up with the increase in average mortgage expenses. The average monthly mortgage payment in San Jose increased from $3,557 in 2014 to $11,633 in 2024, marking a whopping 227.1% rise. That comes out to $139,596 a year in mortgage payments, which is $18,436 higher than the average annual income.
Seattle, which experienced the second-highest salary increase over the last decade, has also seen mortgage costs skyrocket. The average monthly mortgage payment increased by 221.1% since 2014, compared with the average salary, which increased by 51.8%.
Portland, Denver, and Miami round out the list of cities where annual average incomes rose by more than 50%. At the same time, average mortgage payments in all three cities climbed by over 190%. While Portland and Denver report relatively high annual incomes of more than $76,000 each, Miami’s annual average is much lower. Yet, Miami’s average monthly mortgage payment comes in at nearly the same level — $3,515 — which is more than $100 higher than Portland and just $100 less than Denver, despite Miami’s annual average income being about $10,000 lower than both cities.
The five cities where mortgage payments changed the least were: Cincinnati (127%), Washington, D.C. (132.5%), Houston (135.7%), San Antonio (137.2%), and Baltimore (139.6%). Even so, with increases of more than 100%, each of these cities still saw mortgage payments climb by at least $1,000 a month.
Houston also recorded the smallest increase in annual average income. From 2014 to 2024, incomes there rose just 30.4%, from $50,830 to $66,280. Birmingham and Philadelphia followed with similarly slow growth, at 33.1% and 33.5% respectively.
But even with slower income growth, the smaller jumps in mortgage payments may be easier to manage in these cities. In Houston, for example, the average annual income rose by $15,450 from 2014 to 2024, while the average monthly mortgage payment increased by $1,094, or $13,133 a year. In this case, the income gains are just enough to offset the higher housing costs.
Are you thinking about entering one of these markets this year? Start your search with Zoocasa today.