List ranks Washington region as “among best places to save fastest for a down payment.” Wait, what?

DC ends up on “top cities” listicles all the time. But earlier this week, one subject line in my inbox caught my eye:

“From Renter to Homeowner in Less Than 3 Years. D.C. Metro Among Best Places to Save Fastest for a Down Payment.”

The press release, from apartment search company RentCafe, says DC ranks 16th in the top 20 metropolitan areas in the US (out of 174 total) where “renters can save the fastest for their first home.”

Saving up a down payment can be hard, an analyst writes in the RentCafe roundup, which focuses largely on cities in the Midwest. “But, although it may seem like “mission impossible” for some, we were determined to find out where renters could purchase their first home in the shortest amount of time.” Apparently, that list includes DC.

Excuse me, but… what?

The Washington region is known for a lot of things — stuffy businesswear, half-smokes, go-go music.

But I can’t say I’ve ever met anyone who looked around and said: “Wow, homeownership seems remarkably accessible here.” In fact, another real estate search company, Redfin, found in 2020 that DC was one of the least affordable places to buy a home, according to the Washington Post. A Washingtonian article last year focused on “crazy stories from Washington’s pandemic-era real estate boom.” Spoiler: none of those home purchases were crazy because they were crazy cheap.

So, with housing prices high and supply low, how did DC make this list? It’s all about the income.

RentCafe’s analysis compared metro areas by considering the median income for a two-person household. In DC, it’s pretty high, at $120,208. In fact, it’s the highest on RentCafe’s top 20 list.

The company then compared that median income to an estimate of the cost of living for our friendly Median Household, including median rent according to Census American Community Survey data as well as a basic necessities calculator from the Economic Policy Institute. It also calculated spending on “wants” using consumer spending data. Ultimately, they created a “basket of goods” indicating how much this median household would spend — and hence, how much they could save.

They then compared that saving rate to a Zillow estimate of the cost of a “starter home” in the region, which they estimated to cost $341,444. Lucky Median Household — they can save up the $68,289 down payment in just two years and 10 months!

On paper like this, it looks like buying a house should be affordable. Sure, Washington’s housing is pricey. But its workers are paid more. To a certain extent, this is true — but it’s more complicated than that.

If you lined up every person in the Washington metropolitan area ranked by their income, the person standing in the middle of that line would have the median income. But how big is the difference between the people standing at the front and in the back? That can be measured by the Gini coefficient, a number that ranks inequality. In 2016, that number indicated that the District was more unequal than any state in the country, according to the DC Fiscal Policy Institute. “The bottom fifth of DC households had just two percent of total DC income in 2016, while the top fifth had a staggering 56 percent,” the report says.

So, our friends, the Median Household? If they don’t have higher than average expenses, such as medical costs or student debt or childcare costs, they may be able to save up to buy a home in DC quickly, and the people in front of them in line probably can too. But the people standing behind them in line, that other half of the population? That might be harder.

Of course, whether our Median Household can buy a home depends on whether there is indeed a home to buy. As mentioned earlier, housing inventory in the Washington region is low, UrbanTurf reports. And for families with children, the availability of homes with at least two bedrooms is even lower, especially at that $341,444 price point. A RentCafe spokesperson clarified that for this analysis, availability of homes on the market wasn’t taken into consideration.

And, finally, the RentCafe ranking isn’t for DC proper, or even the immediate area surrounding it — according to a spokesperson, that analysis uses data for the Census-designated Washington metropolitan area, which stretches all the way out to exurban counties including Calvert County, Md. and Warren County, Va. Housing costs for these further-off regions are likely included in Zillow’s “starter home” estimate.

If you’re looking to buy in the more urban parts of the region, the average starter home price looks different. For instance, according to Zillow’s Home Value Index, a “bottom tier” home (within the 5th to 35th percentile of home values) within the District’s borders costs $424,602.

So, ultimately, is Washington a good place for first-time homebuyers? It depends on what kind of homebuyer you are, and what kind of home you need. Alas, “it depends” doesn’t work well for a listicle.