Detroit Can't Afford Its Own Cars

The heart of America’s auto industry is also the hardest place in the country to afford a new car.

According to research by Bankrate.com, a median-income household in Detroit has a harder time affording a new car than anywhere in the country. In fact, the median-income household in every city in the U.S. cannot afford an average new car priced at $33,865 according to the research.

To arrive at this conclusion, Bankrate.com figured out 10 percent of the monthly median gross household income in each city and subtracted the average monthly insurance premium in that city to determine exactly how much a family can afford in car payments.

Brankrate also used the “20/4/10” rule, which means that the down payment on the car is assumed at 20 percent, the financing is for four years and the principal, interest and insurance do not exceed more than 10 percent of a household’s monthly gross income.

Using this methodology, it is said that the average Detroit household can afford a monthly payment of $120, which means the new car would have to cost $6,174. In Rochester, NY, the average household can afford a $148 monthly payment, and a new car worth $7,392. In Cleveland, the average family can afford a $151 monthly payment, while families in Hartford, Conn. and Buffalo, NY can afford $156 and $168 monthly payments respectively.

On the other end of the list, residents in San Jose, Calif. fall just short of affording the average new car, with a maximum monthly payment of $662 and an affordable purchase price listed at $32,856. San Franciso families can afford a $31,970 car with $644 monthly payment, while Seattle, Wash. residents can buy a $25,660 car with monthly payments of $644. Those who live in Washington, D.C. and San Diego can afford cars in the $25,000 range, rounding out the top five.

See the full lists below.

Metro Area Affordable Purchase Price Maximum Monthly Payment

1. San Jose, Calif. $32,856 $662

2. San Francisco $31,970 $644

3. Seattle $25,660 $522

4. Washington, D.C. $25,237 $498

5. San Diego $25,033 $500

6. Charlotte, N.C. $21,655 $408

7. Portland, Ore. $21,484 $390

8. Austin, Texas $21,083 $413

9. Raleigh, N.C. $20,901 $394

10. Boston $21,484 $390

Metro Area Affordable Purchase Price Maximum Monthly Payment

1. Detroit $6,174 $120

2. Rochester, N.Y. $7,392 $148

3. Cleveland $7,558 $151

4. Hartford, Conn. $7,960 $156

5. Buffalo, N.Y. $8,319 $168

6. Miami $8,646 $171

7. New Orleans $9,812 $200

8. Birmingham, Ala. $9,823 $183

9. Cincinnati $11,017 $217

10. Providence, R.I. $11,297 $223