Same 4BR house -- wildly different prices

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NEW YORK (CNNMoney.com) -- Imagine you're a mid-level executive living in Grayling, Mich., the "Canoe Capital of the World." You've received a job offer that pays twice as much in posh La Jolla, Calif., the seaside resort near San Diego.
It sounds like a no-brainer, right? Not only will you earn all that extra money, you'll be enjoying some of the best weather in the United States.
You can boat year

NEW YORK (CNNMoney.com) -- Imagine you're a mid-level executive living in Grayling, Mich., the "Canoe Capital of the World." You've received a job offer that pays twice as much in posh La Jolla, Calif., the seaside resort near San Diego.

It sounds like a no-brainer, right? Not only will you earn all that extra money, you'll be enjoying some of the best weather in the United States.

You can boat year round.

What you may not have considered is how much it costs to buy the kind of home you've gotten used to in Michigan. As a matter of fact, you better plan on spending nearly 20 times as much, according to the 2009 Coldwell Banker Home Price Comparison Index.

10 Most-Affordable Cities

Where a 4-bedroom, 2.5-bath, 2,200-square-foot house costs the least.

Rank | Location | Price

1. Grayling, Mich. $112,675

2. Akron, Ohio $121,885

3. Fayetteville, N.C. $130,875

4. Canton, Ohio $131,867

5. Detroit, Mich. $132,000

6. Arlington, Texas $138,775

7. Macon, Ga. $139,007

8. Eau Claire, Wis. $141,270

9. Port Charlotte, Fla. $142,750

10. Wichita, Kans. $144,625

Source: Coldwell Banker Home Price Comparison Index

This index is an "apples-to-apples" comparison of similar homes in so-called "move-up buyer" neighborhoods. It compares the prices charged for 2,200-square-foot, four-bedroom, two-and-one-half bath, single-family homes in more than 300 markets around the nation.

The overall U.S. average for such a house is $363,401, but in Grayling, it sells for just $112,675, the most affordable market in the nation.

La Jolla, on the other hand, is the most expensive; a comparable house there goes for a cool $2.125 million. That more than $2 million disparity is up from 2004, when the spread between the most expensive and most affordable towns was $1.5 million.

"La Jolla, loosely translated, means 'the jewel' in Spanish," said Rick Hoffman, a Coldwell Banker broker in San Diego. "It's always been a place everybody goes to. The weather is excellent. There's great shopping, restaurants and recreation. In non-rush-hour traffic you're only 15 minutes from downtown San Diego."

Grayling also has excellent recreational opportunities, many of which revolve around the Au Sable River, which runs through town. That makes the fishing and canoeing in this northern part of Michigan's Lower Peninsula splendid. Winter sports, like snow-shoeing, cross-country skiing and snowmobiling are also big.

10 Least-Affordable Cities

Where a 4-bedroom, 2.5-bath, 2,200-square-foot house costs the most.

Rank | Location | Price

1. La Jolla, Calif. $2,125,000

2. Beverly Hills, Calif. $1,981,750

3. Greenwich, Conn. $1,519,250

4. Palo Alto, Calif. $1,489,726

5. Santa Monica, Calif. $1,460,912

6. San Francisco, Calif. $1,363,250

7. Boston, Mass. $1,337,578

8. Newport Beach, Calif. $1,315,505

9. Palos Verdes, Calif. $1,237,041

10 San Mateo, Calif. $1,090,000

Source: Coldwell Banker Home Price Comparison Index

But like most of Michigan, the economy here is slow. Much of the business is propped up by Camp Grayling, a nearby Army base. There's also the tourist trade -- lots of vacation homes in the area -- and timbering in the state forests, according to Laurie Jamison, a broker with Coldwell Banker Cornell Realty.

"If you had a $2 million home in Grayling, you'd be king of the mountain," she said. "I couldn't imagine seeing a house like that here." The most expensive home she sold recently was a big, lakefront property for about $600,000.

Big affordability improvement

La Jolla notwithstanding, housing affordability has improved dramatically, according to Jim Gillespie, Coldwell Banker's CEO.

"I am most intrigued with the affordability levels now seen across much of the nation," he said. "Thirty percent of the markets show this type of home to be below $200,000, illustrating the opportunity to take advantage of price declines, interest rate levels and increased selection of homes."

According to the report, in 84 of the U.S. markets Coldwell Banker covers, the sample home price averages under $200,000. At that price, the monthly mortgage costs should not exceed $1,200.

As for that house in Grayling -- factoring in 20% down and a 5.5%, 30-year fixed rate loan -- it would cost a mortgage borrower only about $512 a month.

Under those same terms, the monthly mortgage bill would come to nearly $10,000 in La Jolla. Not that you could get the same deal. The loan would have to be a jumbo mortgage, since it exceeds cap limits for loans issued through Fannie Mae and Freddie Mac. That would add about a point to the interest rate and $1,000 to the monthly housing costs.

Some of the other very affordable towns include: Akron, Ohio, where this type of house costs $121,885; Fayetteville, N.C., $130,875; and Canton, Ohio, $131,867. The most affordable markets are sprinkled all over the Midwest, Southwest and South.

Most of the highest priced markets are in California. The Golden State accounts for eight of the top 10 towns. Beverly Hills is second at $1.982 million, followed by Greenwich, Conn., at $1.59 million. Boston is the other non-California town to crack the top 10; it was seventh at $1.34 million. That was one place behind San Francisco, the biggest city on the list.

Variations within states

Not only are there huge affordability differences around the nation, there are big spreads within the same states. While California has many of the most expensive cities, for example, it also has some very affordable ones.

In Lancaster, Calif., which lies just north of Los Angeles and is one of the nation's fastest growing cities, the sample home goes for $165,205 -- nearly $2 million less than La Jolla.

West Hartford, Conn., has these exec homes for $242,789, more than $1 million less than Greenwich. In Massachusetts, a home in the old mill town of Worcester costs $242,769, a million dollars less than in Boston, just 47 miles away.

The smallest spreads occur in the wide-open-space states, such as Oklahoma, where homes in the most expensive market, Oklahoma City ($164,250), cost less than $10,000 more than the most affordable one, Tulsa ($154,800).

In Idaho, Boise homes cost $215,432 compared with $204,518 in Coeur d'Alene. And homes in Florence, Ky., cost $212,720, compared to $188,017 in Lexington.

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