Posted on July 23, 2012

Cities Where Homes Cost Less than a Car

Rusty Weston, MSNBC, July 23, 2012

For many Americans, homeownership is the epitome of living the American dream. Yet, in towns with high tumbling home prices and double-digit vacancy rates, median-priced homes now cost the equivalent of new American cars — except, as investments go, they’re slightly more risky.


This quandary is especially meaningful to residents of Motor City, who have experienced deepening levels of housing hell in recent years. Much has been written about Detroit’s high misery index, and the challenges of thriving in a city with high unemployment, high crime rates, and city services under severe budgetary constraints. And yet, for those willing to take a long view of the city, Detroit also offers amazing bargains to residents dedicated to living in that community.


These are the cities where homes cost less than a car:

1. Detroit

  •  Median listing price: $21,000
  •  Comparably priced car: Chevy Malibu ($21,000)
  •  Housing price change (year over year): 5.2 percent
  •  Median household income: $29,447
  •  Unemployment: 9.9 percent


2. Flint, Mich.

  •  Median listing price: $31,950
  •  Comparably priced car: Chrysler 300 ($31,950)
  •  Housing price change (year over year): n/a
  •  Median household income: $28,835
  •  Unemployment: 8.9 percent

According to Trulia’s Kolko, both Flint and Detroit experienced significant housing-price declines, not because of overbuilding as in Florida but because of “long-term job decline coupled with declining populations.” Worse, Flint suffers from a significant amount of poverty with about 44 percent of the population earning less than $25,000 a year, according to Census economic data.

3. Gary, Ind.

  •  Median listing price: $39,900
  •  Comparably priced car: Ford Expedition ($39,900)
  •  Housing price change (year over year): — 7.5 percent
  •  Median household income: $27,367
  •  Unemployment: 8.5 percent


4. Redford, Mich.

  •  Median listing price: $40,000
  •  Comparably priced car: Ford F-450 ($55,000)
  •  Housing price change (year over year): 5.2 percent
  •  Median household income: $52,573
  •  Unemployment: 9.9 percent

Redford is not a large city, but it suffers from problems such as 1-in-159 homes in foreclosure, the worst rate among cities on this list. It also has aging homes, most of which were built just after World War II and may be expensive to maintain. Like Warren, prices have dropped by 38.5 percent from their peak according to FHFA data. On the bright side, at $52,573 the average annual income in Redford is higher than in many of its neighboring cities on this list.

5. Warren, Mich.

  •  Median listing price: $49,900
  •  Comparably priced car: Lincoln Navigator ($59,900)
  •  Housing price change (year over year): 6.5 percent
  •  Median household income: $46,247
  •  Unemployment: 9.9 percent