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How Many People in Denver Who Want to Buy a Home Can't Afford One

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Earlier this year, Realtor.com named Denver one of the ten best U.S. cities for singles wanting to buy a home.

But according to a new study by Zumper, a website focusing on housing and rentals, plenty of them won't be able to afford such a purchase once they arrive here.

In part one of a renter survey headlined "The American Dream Is Alive, But Out of Reach for Many," Zumper collects data from fifteen major markets, including Denver. Among the questions posed to more than 6,000 of the site's users: How many of you want to buy a home, and how many of you will be able to afford a mortgage?

The answers land Denver among the places with the largest gap between the desire for home ownership and the ability to make it a reality.

Why? Zumber marketing associate Crystal Chen drills into the data after the following countdown, with the cities ranked from those with the smallest discrepancy to the largest.

Number 15: Austin
Percentage of people who want to buy a home: 94.3 percent
Percentage of people who are able to afford a mortgage: 72.1 percent
Difference: 22.2 percent

Number 14: New York City
Percentage of people who want to buy a home: 89.8 percent
Percentage of people who are able to afford a mortgage: 66.8 percent
Difference: 23 percent

Number 13: Chicago
Percentage of people who want to buy a home: 89.2 percent
Percentage of people who are able to afford a mortgage: 63.4 percent
Difference: 25.8 percent

Number 12: Atlanta
Percentage of people who want to buy a home: 83.8 percent
Percentage of people who are able to afford a mortgage: 57.4 percent
Difference: 26.4 percent

Number 11: Washington, D.C.
Percentage of people who want to buy a home: 90.5 percent
Percentage of people who are able to afford a mortgage: 63 percent
Difference: 27.5 percent

Number 10: Las Vegas
Percentage of people who want to buy a home: 88.5 percent
Percentage of people who are able to afford a mortgage: 55.9 percent
Difference: 32.6 percent

Number 9: Dallas
Percentage of people who want to buy a home: 97.2 percent
Percentage of people who are able to afford a mortgage: 63.2 percent
Difference: 34 percent

Number 8: Houston
Percentage of people who want to buy a home: 94.5 percent
Percentage of people who are able to afford a mortgage: 59.7 percent
Difference: 34.8 percent

Number 7: Boston
Percentage of people who want to buy a home: 94.9 percent
Percentage of people who are able to afford a mortgage: 56.6 percent
Difference: 38.3 percent

Number 6: Denver
Percentage of people who want to buy a home: 95.1 percent
Percentage of people who are able to afford a mortgage: 55.7 percent
Difference: 39.4 percent

Number 5: Philadelphia
Percentage of people who want to buy a home: 89.5 percent
Percentage of people who are able to afford a mortgage: 47.9 percent
Difference: 41.6 percent

Number 4: Miami
Percentage of people who want to buy a home: 93 percent
Percentage of people who are able to afford a mortgage: 42.9 percent
Difference: 50.1 percent

Number 3: San Francisco
Percentage of people who want to buy a home: 90.7 percent
Percentage of people who are able to afford a mortgage: 40 percent
Difference: 50.7 percent

Number 2: Los Angeles
Percentage of people who want to buy a home: 89.8 percent
Percentage of people who are able to afford a mortgage: 22.8 percent
Difference: 67 percent

Number 1: San Diego
Percentage of people who want to buy a home: 91.5 percent
Percentage of people who are able to afford a mortgage: 20 percent
Difference: 71.5 percent

Why did Denver finish in the bottom six of major cities when it comes to the difference between wanting to buy a home and the ability to do so? One reason, according to Zumper's Chen, corresponding via e-mail, involves the rates at which housing costs and wages are rising.

"The Denver Chamber of Commerce's economic forecast predicts that Denver's personal income growth will accelerate around 5 percent in 2016," she notes. "Meanwhile, home values have increased by roughly 10 percent in the past year. So although Denver's wages are growing, they seem to be outpaced by increasing home value costs."

The only cities in the survey with more potential home buyers who are unable to afford a mortgage than Denver are Philadelphia, Miami and three California cities that have long been known for high housing costs: San Francisco, Los Angeles and San Diego. Chen sees a link among them.

"One common thread seems to be the popularity of those cities among young people," she allows. "Most of them cannot afford a home while fresh out of college and/or beginning to join the workforce because they are still in the early stages of their careers and rely on renting instead of owning."

For these reasons, plenty of millennials must live with roommates in order to divide housing costs. Of those who responded to the Zumper survey, 62 percent of them have roommates.

Surprisingly, this percentage in Denver is lower than the national average. Chen reveals that "45 percent of Denver respondents said they were currently living with roommates."

That's one piece of comparatively positive housing news amid a report that's not exactly brimming with good news for those who'd like to own their own home. Click to read "The American Dream Is Alive, But Out of Reach for Many."


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