Here’s how much you need to earn to afford a house in NJ

This will come as no surprise to prospective New Jersey home buyers, but a new report says the average first time home buyer doesn’t make enough to afford a home.

The report comes from a home-buying website Clever and it says the gap between what you need to earn to afford you first house and what people are actually making is $14,972.

Surprisingly, that places us only 13th; compare that to California, where the gap is $130,581.

Andrii Yalanskyi

Here’s the methodology:

Data sources for this study include the U.S. Census Bureau, the American Community Survey, the Federal Reserve, the U.S. Department of Housing and Urban Development, Zillow, Bankrate, Rocket Mortgage, Integrated Public Use Microdata Series (IPUMS), and Don't Quit Your Day Job (DQYDJ). Data analysis took place in March 2024.

Nationally, to comfortably afford the median-priced home ($332,494), first-time buyers need a household income of $119,769. The median home is affordable for median earners in just four states and six of the 50 largest metro areas.

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The numbers they used for New Jersey: median home price of $341,595, average monthly mortgage payment on that home is $31,169, local median household income is $96,346, and the income needed to afford that home is $111,314, leaving the gap of $14,972.

The median household in the U.S. makes about $74,755 — $45,000 less than they need to afford the median-priced home as a first-time buyer. The most expensive home the median household could comfortably afford after a 10% down payment is $207,529. That number is based on a mortgage interest rate of 7.22%.

So it’s not just you, very few people can afford a new home.

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Source: What a first-time homebuyer needs to earn to afford a house in NJ