Only People In America's Richest Area Can Afford New Cars

As the folks in Ingolstadt struggle to figure out how to sell the 2015 Audi A3 to the coveted hipster demographic, this is the market they should aim at: Washington, D.C. People there are the only ones who can afford it!

AOL Autos has the scoop on a new report from the website Interest.com, which claims that only residents of the D.C. metro area — which has the highest concentration of wealth in the country — who earn the city's median income can afford the average price of a new vehicle.

That average price? Just $32,086 last year, the report says, which should net you a reasonably-equipped A3.

The study centers on average new car price versus the city's median income. Assuming the new car buyer does the smart thing and puts 20 percent down, finances for 48 months, and makes sure car costs don't exceed 10 percent of household gross income, then only D.C. residents can afford to pay $32,531, or $641 per month, for a vehicle.

Of course, you could always spend a whole lot more than that or finance for a much longer term, and many people do because they can. But for the average family, the study says it's not a terribly good move.

"Too many families are spending way too much on new cars and trucks," said Mike Sante, managing editor of Interest.com. "Just because you can manage the monthly payment doesn't mean you should let a $30,000 or $40,000 ride gobble up such a huge share of your paycheck."

People certainly shouldn't be deterred from buying new cars because someone's gotta buy new cars. But since there are so many great, well-equipped used cars on the market for far less, this ends up being a good example of how get a lot more bang for your buck by going pre-owned.

After D.C., residents of Boston and San Francisco were closest to being able to pay for a new car based on median income, but it still wasn't enough for the average vehicle, the study says.

Are new cars getting too expensive? While this city just centers on average income in a city against average new car prices, it raises some interesting questions. As we've said here time and time again, economic reality is one of the primary reasons young people buy fewer cars than older people, not because "Millennials hate cars."

While there are plenty of buyers who can afford Bentleys, or Ford Focuses, this study doesn't make a terribly good case for young hipsters getting into Audi A3s.

Hat tip to TTAC!