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TH E M R EP O RT | 51 O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST DATA Raising a Family? Consider Buying a Home in These Top Cities If littles are part of the big picture, then the following U.S. enclaves are best-suited for the whole clan, WalletHub says. A merican families prioritize several aspects when choos- ing a location to raise a family, and according to Wal- letHub's 2017 Best and Worst Places to Raise a Family report, those factors include affordability, health and safety, family fun, education, and childcare. Using those dimensions, WalletHub's analysts compared the most populated cities across the nation to develop its list. So which cities ranked as places for homebuyers to consider, and which should be avoided? Topping the list as the best place to raise a family is Overland Park, Kansas, also earning the No.1 rank as the most affordable location in the U.S. The city also has one of the highest median family salaries, most affordable housing rates, and lowest percent- age of families living below poverty level. Following suit is Madison, Wisconsin, and Plano, Texas, which also ranked in the top five cities with the highest median family salary, as well as one of the lowest percentages of families living below the poverty level. The Texas city additionally classified as having one of the lowest divorce rates. Completing the best five are Seattle, Washington, and Fremont, California. The Golden Gate State community boasts one of the lowest divorce rates and lowest percentages of families living below poverty levels. Ranking as the worst city is Birmingham, Alabama, followed by Detroit, Michigan. With some of the highest violent crime rates per capita and highest divorce rates, these locations should be avoided, the report cautions. Finishing the worst cities is Hialeah, Florida, which has one of the lowest median family salary levels. Trailing it were Shreveport, Louisiana, and San Bernardino, California. Housing Is Affordable, But Consumers May Not Feel It Perception can easily obscure reality, and many median-income buyers are convinced that homeownership is out of their reach. H ousing has been reach- ing record affordability, but in a recent Freddie Mac Perspectives Blog, VP Chief Economist Sean Becketti posed the question: Why doesn't it feel that way? Apparently, it's due to three reasons. The National Association of Realtors produces what Becketti would consider the most widely cited measure of housing affordability, the Housing Affordability Index (HAI). According to the index, median- income families have more than enough income to qualify for a mortgage to buy a median-priced house. However, Becketti said the reason that doesn't feel like a correct statement is because, to start off with, houses are expensive. House prices have risen 6 to 7 percent per year since the house price trough in 2012, leaving them higher now than they were in 2006 at the pre-crisis peak. Yet most Americans' income hasn't increased with the rise in home costs. In fact, salaries have only increased an average 2.4 percent year-over-year in the same time frame. Secondly, the limited supply of housing has created an illusion that homes aren't affordable. Buyers, including many paying cash, are quickly putting offers in as soon as homes go on the market and are commonly going into bidding wars. This is causing some homeowners to hold off on putting their home on the market. "The imbalance between the demand for and the supply of homes boosts house prices further and can transform the perception of unaffordability into actual unaffordability," Becketti said. Finally, according to Becketti, borrowers aren't sure if they can qualify for a mortgage. Though the HAI is a good tool, it doesn't tell the whole story. It tells whether a median-income family will be able to comfortably cover a monthly mortgage payment on a median-priced home but not whether they have too much outstanding debt, if their credit score is high enough—if they even have a credit score—if they can document a stable income, or if they have enough money for a down payment. "It's easy to see why homeownership feels unaffordable to so many people," Becketti said. "But the HAI isn't kidding— mortgage payments are more affordable today than at almost any time in history."