Exclusive | NYC ranks fifth-hardest metro for first-time homebuyers 7% mortgage rates are squeezing them even more

Buying a starter home in New York was already a stretch for the average household.Now mortgage rates are back above 7% — adding yet another hurdle for would-be homeowners already contending with stubbornly high prices and a shortage of homes for sale.The New York metropolitan area is the fifth-hardest place in the country to get on the property ladder, according to new research from personal-finance company Achieve.An entry-level home in the metro costs about $489,359, while the median household earns $99,155.Assuming a 10% down payment and keeping mortgage payments to 30% of gross income, Achieve calculated that a household would need to earn $114,380 a year to comfortably afford that home — 15.4% more than the typical household actually makes.And that calculation comes as borrowing costs are heading in the wrong direction.The average 30-year fixed mortgage climbed back above 7% this week after years of languishing inflation, further eroding the purchasing power of buyers who need financing.For buyers, however, the problem is much bigger than the mortgage rate alone.Appraiser Jonathan Miller, of StreetMatrix, told The Post that an acute shortage of homes for sale is preventing the normal market correction that might otherwise give buyers some relief.“When we think about affordability, I think the influence of inadequate inventory is more powerful on the affordability topic than actual rates themselves,” Miller said.Normally, Miller explained, a sharp increase in borrowing costs would cause sales to fall, inventory to build and prices to soften.This time, that last part isn’t happening.“Mortgage rates are over 7%, and prices are still rising, right? That’s not logical to many people,” Miller said.“But the reason it’s not logical is because the limited inventory is distorting everything.”Part of the problem is the so-called mortgage “lock-in effect.”Millions of homeowners secured ultra-low mortgage rates in previous years and now have littl...