Sure seems like everyone is looking for a deal these days, especially when it comes to buying a home. But the truth of the matter is that where a local market ranks on the value scale depends a LOT on its location.
Why is that? Well, consider this real estate fact of life — a “bargain bin” home in New York City’s got nothing on the dirt cheap real estate in Detroit. But, what happens when we look at the price of a home on a per square foot basis? It levels the playing field and allows us to see how much of a bargain homebuyers can really get in different cities. And those numbers are definitely surprising.
To help shine a little spotlight on this very important data point that every homebuyer and seller needs to consider, we charted out the median square footage for the 100 largest U.S. cities, and then sorted everything by the price per square foot. Check it out.
In New York City (specifically, we’re just looking at the island of Manhattan), the median square footage for non-foreclosure homes on the market right now is 1000 sq ft. This might not seem too bad (given the Big Apple’s notorious reputation for itty bitty homes) until you take a closer look and realize that the median price per square foot – that’s a 12 inch by 12 inch square – is $1000. That means that a 1000 square foot home in NYC is going cost you a million bucks.
On the other end of the spectrum, we have Detroit. Without beating a dead horse, let’s just say that this city has seen better days. Well, based on the non-foreclosure homes currently for sale, the median square footage is 1,219 sq ft…just slightly bigger than NYC. But here’s the real kicker – the median price per square foot is just 19 buck-a-roos. That’s right, a median-sized home in Motor City for a median-sized price tag (approximately $23K) will cost you much less than a brand new BMW 1 Series. But, not to be all doom and gloom here, Detroit did get a little ray of hope on Tuesday when Case-Shiller revealed that it was the only major U.S. city with a year-over-year home price increase.
Meanwhile, in the middle of these two extremes are Lexington KY, Durham NC and Saint Louis MO at $97 per square foot. Looking at the median square footage in Durham (median 1,850 sq ft), Saint Louis (median 1,320 sq ft) and Lexington (median 1,780 sq ft), you can probably get a decent-sized home for under $200,000.
So, if you wanted to blow $200Gs on a house, you’re going to have vastly different options in different cities. For instance, you could buy a 3,800+ sq ft McMansion in North Las Vegas or a cute little 1-bedroom, 1-bathroom 554 sq ft condo (er…closet) in Boston. Now is that crazy or what?!
What’s the situation like where you’re looking — how much house can you get for your money?