Key Takeaways:

• To afford a median-priced home in NYC, a buyer must have an annual household income of at least $211,970 — almost 3x more than a buyer in the national market.
• The recent decline in mortgage rates led to a $10,625 decline in the minimum salary needed compared to a year ago.
• Thanks to falling asking prices, the income needed to afford a home in Manhattan declined $33,593 year-over-year.

It’s an age-old question in New York City: “Could I afford to buy a home?”

It’s no secret that for most New Yorkers, buying a home feels far out of reach. The citywide median asking price stands at a staggering $1.05M as of August 2024, more than 3x the national average. But StreetEasy® data shows signs that median asking prices may have already reached their peak. With inventory rising and mortgage rates declining, those who can afford to buy may find this is their moment.

But one looming question remains: how much money does it actually take to buy a home in the most expensive city in the country?

Salary Needed to Buy in NYC

To calculate what it takes to buy a home in NYC, we looked at median asking prices for the entire market and the lowest third of the market, based on StreetEasy listings as of August 2024. This captures what buyers are most likely to encounter if they’re looking at the most affordable end of the market, as well as the market as a whole. We calculated the income required to keep monthly mortgage payments within 30% of gross income, assuming a 20% down payment at a 6.5% 30-year mortgage rate (the average as of August 2024).

According to U.S. Census data, only 15% of all households in NYC made a combined income of $200,000 or more, putting them within range of affording a median-priced home. At a minimum income of $211,970, the average NYC buyer must earn almost 3x more than a buyer in the national market.

There are plenty of homes available in NYC priced below the median, but many of these homes would still require a combined household income in the six-figure range. To afford a median-priced home in the bottom third of the market, a buyer must have an annual household income just shy of $95,000, which encompasses about 39% of all households in NYC.

Minimum Required Income Has Dropped as Mortgage Rates Decline

The average 30-year mortgage rate reached a 16-month low in the last week of August, falling below 6.5%. Although asking prices remain high, the recent declines in mortgage rates have improved buying power. The current minimum income of $211,970 for a typical buyer with a mortgage in NYC is $10,625 lower than a year ago.

Manhattan Homes Under $1M on StreetEasy Article continues below

Lincoln Square

61 West 62nd Street

$679,000

1 |

1

Upper East Side

179 East 79th Street

$725,000

1 |

1

Lenox Hill

249 East 62nd Street

$985,000

Studio |

1

Yorkville

320 East 83rd Street

$399,000

1 |

1

Lincoln Square

43 West 61st Street

$950,000

1 |

1

South Harlem

226 West 111st Street

$499,000

2 |

1

Upper West Side

400 West End Avenue

$495,000

Studio |

1

Yorkville

446 East 86th Street

$510,000

1 |

1

Upper East Side

3 East 85th Street

$840,000

2 |

1

East Village

228 East 13th Street

$600,000

1 |

1

Inwood

57 Park Terrace East

$549,000

2 |

1

Beekman

455 East 51st Street

$695,000

1 |

1

Brooklyn has been the city’s most competitive sales market, but the recent drop in mortgage rates provides a little relief. A buyer in Brooklyn today can afford a home with $1,857 less income than a buyer in the borough just one year ago. The income required to buy a home dropped the most in Manhattan, where buyers today can earn $33,593 less than they did one year ago, thanks to declining asking prices in the borough. However, Manhattan remains out of reach for many buyers, with an income of at least $308,449 required to afford a median-priced home.

Outlook for Prospective Buyers

Asking prices are moderating, and as more homes come onto the market, buyers will continue to gain negotiating power. Across the city, price cuts are becoming more common compared to last year — one of the emerging signs that asking prices have likely reached their peak in NYC. Furthermore, patient prospective buyers may find they can afford more homes as the year progresses, as sellers grow more likely to cut asking prices during fall.

Brooklyn Homes Under $1M on StreetEasy Article continues below

East Flatbush

285 East 35th Street

$289,000

1 |

1

Canarsie

1346 Linden Boulevard

$700,000

3 |

2

Crown Heights

1360 Bergen Street

$499,999

5 |

2

Williamsburg

139 Skillman Avenue

$665,000

Studio |

1

Coney Island

2932 West Fifth Street

$399,000

2 |

1

Homecrest

2066 East 29th Street

$968,000

3 |

2.5

Brooklyn Heights

111 Hicks Street

$690,000

1 |

1

Gowanus

500 Fourth Avenue

$595,000

Studio |

1

Cypress Hills

225 Etna Street

$849,000

5 |

2

Park Slope

300 Eighth Avenue

$288,808

Studio |

1

Bath Beach

129 Bay 28th Street

$960,000

3 |

2.5

Dyker Heights

1171 79th Street

$999,000

3 |

1

Falling mortgage rates can also help make purchasing a home in the city more affordable. Recent declines in mortgage rates have brought more homes within reach for the city’s buyers, and further rate cuts could mean more New Yorkers fall within the income bracket required to afford a home. Even a fractional drop in rates can have a dramatic effect on a buyer’s purchasing power, and lowers the minimum income required to buy a home.

Resources for Buyers

In this market, where even a small break in mortgage rates or down payment can have a significant impact on purchasing power, NYC buyers should find out if they qualify for mortgage assistance. These city, state, and federal programs offer lower interest rates, down payment assistance, or even help with closing costs. For instance:

• The State of New York Mortgage Agency (SONYMA) provides several options for qualified buyers, with 3% down payment assistance and rates as low as 6.125% within programs such as Achieving the Dream, Low Interest Rate, and Homes for Veterans. 
• HomeFirst, a city program, provides first-time buyers making up to 80% of the area median income with as much as $100,000 toward their down payment or closing costs.

For more programs and information, see our article on 10 Mortgage Assistance Programs First-Time Home Buyers Should Know About.

Queens Homes Under $1M on StreetEasy Article continues below

Maspeth

62-36 59 Drive

$485,000

1 |

1

Jackson Heights

35-55 78th Street

$670,000

2 |

1

Jackson Heights

34-24 82nd Street

$350,000

1 |

1

Rego Park

61-15 97th Street

$575,000

3 |

2

Hunters Point

27-20 42 Road

$900,000

1 |

1

Beechhurst

166-41 Powell Cove Boulevard

$425,000

1 |

1

Little Neck

58-25 260th Street

$948,888

3 |

1.5

Hunters Point

46-40 Vernon Boulevard

$895,000

1 |

1

Jackson Heights

81-05 35th Avenue

$315,000

1 |

1

Forest Hills

111-15 75th Avenue

$459,000

1 |

1

Hunters Point

27-20 42 Road

$700,000

Studio |

1

Rego Park

99-05 63rd Drive

$369,000

2 |

1

No matter your financial situation, the licensed StreetEasy Concierge is available to give complimentary, personalized guidance on finding and buying a home in NYC within your budget. Connect with the Concierge to discuss everything from affordability to the buying process to current market trends. When you’re ready to buy, they’ll even match you with a buyer’s agent from StreetEasy’s Experts Network, who can provide local market expertise and negotiate on your behalf to get the best possible deal.

^{StreetEasy is an assumed name of Zillow, Inc. which has a real estate brokerage license in all 50 states and D.C. See real estate licenses. StreetEasy does not intend to interfere with any agency agreement you may have with a real estate professional or solicit your business if you are already under contract to purchase or sell property. All data for uncited sources in this presentation has been sourced from Zillow data. Copyright © 2024 by Zillow, Inc. and/or its affiliates. All rights reserved.}