New Jersey Is Home to Six of the Nation’s 10 Counties Most Vulnerable to a Downturn

Six of the 10 U.S. housing markets most vulnerable to a downturn are located in New Jersey, where a higher percentage of household income is required to maintain homeownership, according to Realtor.com. Similarly, pricey markets in the Chicago metro area and in California could see home sales slow in the wake of elevated mortgage rates and constant home price growth. Combined, New Jersey, Chicago, and California house 34 of the 50 most at-risk counties across the nation.

In these regions, substantial homeownership costs like mortgage payments, property taxes, and insurance on median-priced single-family homes consumed over 30% of average local wages, while homes in pricey housing markets like San Joaquin County, CA and Bergen County, NJ required even larger shares of local incomes at 48.9% and 48.3%, respectively.

This smattering of locales might seem geographically random because “rural northern California and the areas around NYC and Chicago don’t have much in common, but they do share slower home-price growth than the Sunbelt because their populations are growing more slowly,” says Holden Lewis, home and mortgage expert at NerdWallet. Adds Jacob Channel, senior economist at LendingTree: “Homes in the Chicago and NYC areas, as well as homes scattered across many parts of California, are often relatively expensive compared to houses in other parts of the country, and, because of this, people in these areas may need to stretch their budgets a bit more in order to be able to afford a home.”

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