The American City With the Cheapest Houses

By Douglas A. McIntyre Published Nov 11, 8:30AM EST

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

The American City With the Cheapest Houses — © AlenaMozhjer / iStock via Getty Images

Although mortgage rates have slowed the activity in the residential housing market, during the summer, home prices continued to rise in almost every city in America. In 181 of the country’s 185 largest cities, prices were up during the third quarter. The median price of a single-family existing home hit $398,500, up by 8.6% from the same period a year ago. However, the price by market ranged by a huge amount, with Decatur, Illinois, at the bottom. The median home price there during the period was only $123,000, up by 4.3%.
[in-text-ad]
The move in home prices began three years ago. NAR Chief Economist Lawrence Yun said, “The median income needed to buy a typical home has risen to $88,300 – that’s almost $40,000 more than it was prior to the start of the pandemic, back in 2019.” This, combined with high mortgage rates, is what will cause an overheated market to cool.
[nativounit]
The market with the most expensive homes was San Jose at $1.688 million, according to the National Association of Realtors’ third-quarter report. Five of the top six markets based on median home prices are in California. They are clustered around San Francisco and Los Angeles: San Francisco ($1.3 million), Anaheim ($1.2 million), San Diego ($900,000) and Los Angeles ($893,000). The other market in the top six is Honolulu at $1.1 million.
[wallst_email_signup]
Almost all the markets with the lowest median home prices are in the industrial Midwest, which used to be among the most affluent cities in the country. As industries moved their manufacturing elsewhere, many of these metros lost population. Youngstown, Ohio, ($148,000) and Peoria ($148,000) and Rockford ($174,000) in Illinois are prime examples.
[recirclink id=1181217]
Decatur is among America’s poorest cities, according to the Census Bureau. It has a population of slightly less than 70,000 and an extremely low median income of $45,404. Just shy of 20% of people live below the poverty line.

Median home prices in Decatur rose 4.8% in the third quarter. As a recession hits, that figure is unlikely to go higher.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.