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By Samuel Weigley, 24/7 Wall St.

The housing crash that began in late 2006 resulted in trillions of dollars in lost wealth and millions of families owing more on their mortgage than their houses are worth. But while the economic downturn has made it nearly impossible for many people to sell their homes, prospective buyers in key metropolitan areas can get quite the bargain.

Fiserv recently released its first-quarter 2012 report on home prices. The report includes home prices for 198 metropolitan areas, as well as median annual household income. The Fiserv report also measures the affordability of homes by ranking median home price as a percentage of median annual income. Based on Fiserv’s report, 24/7 Wall St. identified the 10 most affordable housing markets in America.

Five of the metropolitan areas on this list are in Michigan, with another metro area based in Indiana but consisting of some Michigan households. Fiserv Chief Economist David Stiff told 24/7 Wall St. that much of this has to do with the decline of automobile industry jobs in the state. Stiff notes that homes in many parts of Michigan were already relatively cheap before the recent economic downturn. However, the loss of auto manufacturing jobs and the unemployment that ensued pushed housing prices down even further.

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More broadly, nine of the 10 metropolitan areas on this list are in the Midwest. With some exception, Stiff notes, the Midwest was not hit as hard by the housing bust as compared to other regions. The data backs that up. The price declines in all but two metro areas were less than the U.S. average decline of 33.3 percent between the first quarter of 2007 and 2012. In addition, Stiff adds, there are fewer limitations to home building in the Midwest, compared to places such as the West Coast. With higher supply, home prices still remain low in the Midwest, despite an increased demand for homes.

Pushing prices further down in some areas are high foreclosure rates. Foreclosures have led banks to sell homes at very cheap prices in many areas such as Detroit. Now, median home prices in Motown are just $41,000 -- less than a family’s median annual income in the region. To further emphasize how affordable a home is in the area, a family making the median income who bought a median-priced home -- putting a 20 percent down payment and taking a 30-year fixed-rate mortgage at an average rate -- would pay only 3.6 percent of its monthly income on a mortgage. However, low prices in many metro areas have allowed some people to purchase homes with cash or at least put down even larger down payments, Stiff notes.

In addition to reviewing the median home price as a percentage of median family income provided by Fiserv, 24/7 Wall St. examined the percentage of monthly income that would go to mortgage payments for these homes, assuming a 30-year-fixed rate mortgage and a 20 percent down payment on the house. We also considered median home price changes from both a housing market peak time and the first quarter of 2007 until the first quarter of 2012, also provided by Fiserv. Looking into the future, we looked at predictions for home price growth in 2012, 2013 and the time between 2012 and 2017. Finally, we considered a metro area’s population and number of households as of the 2010 census and the May 2012 unemployment rate to provide further context.

These are America’s most affordable housing markets.

10. Lansing-East Lansing, Michigan

  •  Home price as percent of income: 152 percent (tied for ninth)
  •  Median home price: $99,000 (17th lowest)
  •  Median family income: $65,300 (80th highest)
  •  Unemployment: 6.8 percent (48th lowest)

Lansing is the first of five (six, if parts of South Bend metro are included) metropolitan areas located in Michigan to make this list. Home prices in the area are expected to rise by an average of 5.8 percent annually between 2012 and 2017, among the top third projected increases in the country. The median home price is just south of $99,000, or $60,000 less than the median home price in the United States. Meanwhile, the area’s median family income of $65,300 is $2,400 higher than the national median income. The 6.8 percent unemployment rate, far below the 8.3 percent rate in the U.S., is also the lowest rate for Michigan metro areas on this list. This could help the housing market recover quicker by boosting demand.

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9. Appleton, Wisconsin

  •  Home price as percent of family income: 152 percent (tied for ninth)
  •  Median home price: $108,000 (28th lowest)
  •  Median family income: $70,900 (50th highest)
  •  Unemployment: 6.0 percent (23rd lowest)

The median home price in Appleton of $108,000 is higher than any metro area on this list, but it is still well below the U.S. median home price of $159,000. Home prices have consistently been cheap in the area for years. The median price between 2007 and 2012 only declined by 4.9 percent, far less than the national drop of 33.3 percent. Meanwhile, Appleton’s median family income of $70,900, in the top third of metro areas considered, makes home ownership affordable for most residents. In addition, the 6.0 percent unemployment rate is far below the national rate of 8.3 percent.

8. Battle Creek, Michigan

  •  Home price as percent of family income: 150 percent (tied for seventh)
  •  Median home price: $79,000 (third lowest)
  •  Median family income: $52,300 (23rd lowest)
  •  Unemployment: 6.9 percent (53rd lowest)

The median family income in Battle Creek of $52,300 is the 23rd lowest among all metro areas surveyed. But with home prices the third cheapest of all metro areas, buying a home is quite affordable. Home prices were relatively cheap before the economic downturn, too. Prices fell by 16.1 percent from their peak in the second quarter of 2006 to the first quarter of 2012, a far more modest decline than the nationwide home prices drop of about 33 percent. And while home prices are expected to fall by 1 percent across the U.S. in 2012, they are expected to rise by 1.9 percent in the Battle Creek area, one of the largest increases in the country.

7. Youngstown-Warren-Boardman, Ohio-Pennsylvania

  •  Home price as percent of family income: 150 percent (tied for seventh)
  •  Median home price: $80,000 (fifth lowest)
  •  Median family income: $53,300 (32nd lowest)
  •  Unemployment: 8.0 percent (94th highest)

Homes in the Youngstown-Warren-Boardman area are affordable, even for those with modest incomes. While median family income in the region is $9,600 lower than the national median income, median home prices are even lower -- the fifth lowest in the country. And the housing market may not have even hit bottom yet. Home prices in the Youngstown area are expected to drop for all of 2012 by 1.8 percent, more than the 1 percent drop across the United States. However, prices in 2013 are expected to rise by 5.1 percent, slightly faster than the U.S. increase.

6. Monroe, Michigan

  •  Home price as percent of family income: 141 percent
  •  Median home price: $89,000 (9th lowest)
  •  Median family income: $62,900 (97th highest)
  •  Unemployment: 7.6 percent (88th lowest)

The median family income in Monroe is the same as the median family income in the United States. But the median home price of $89,000 is $60,000 lower than the U.S. median home price. A relatively low unemployment rate of 7.6 percent, well below Michigan’s unemployment rate of 8.5 percent and the U.S. unemployment rate of 8.3 percent, may help get the housing market back on more solid ground. While home prices are expected to rise at an annual rate of 3.9 percent across the U.S. between 2012 and 2017, in Monroe prices are expected to rise 5.2 percent annually over the same period.

5. Memphis, Tennessee

  •  Home price as percent of family income: 139 percent
  •  Median home price: $79,000 (3rd lowest)
  •  Median family income: $56,900 (52nd lowest)
  •  Unemployment: 8.8 percent (58th highest)

Memphis is the only metropolitan area on this list not located in the Midwest. While home prices of $79,000 are the third lowest of all metropolitan areas measured, home prices are expected to rise at an annual rate of 6 percent between 2012 and 2017, more than two percentage points more than the national median. Home prices are expected to rise 8.6 percent next year alone, one of the biggest growth rates in the country. According to Stiff, Tennessee’s expected home price is probably due to demographics -- population growth will likely be higher in states such as Tennessee compared to industrial Midwest states such as Michigan and Ohio.

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4. Warren-Troy-Farmington Hills, Michigan

  •  Home price as percent of family income: 133 percent
  •  Median home price: $95,000 (12th lowest)
  •  Median family income: $71,600(48th highest)
  •  Unemployment: 8.7 percent (65th highest)

In the Warren-Troy-Farmington Hills metro area, the combined factors of high income and low home prices make paying for a house easy. The median family income of $71,600 is the highest on this list and nearly $20,000 higher than the nearby Detroit metro. Furthermore, the median home price of $95,000, which has fallen 40.9 percent since it reached its peak in the second quarter of 2005, means that homes have become a bargain for those who can afford to buy one in this shaky economy.

3. Rockford, Illinois

  •  Home price as percent of family income: 132 percent
  •  Median home price: $80,000 (fifth lowest)
  •  Median family income: $60,000 (76th lowest)
  •  Unemployment: 11.6 percent (17th highest)

For decades, Rockford’s economy has relied primarily on a strong manufacturing base, but in recent years it has struggled with high unemployment due to the manufacturing industry’s decline. Rockford’s unemployment rate of 11.6 percent is the highest of all metro areas on this list and the 17th highest of all metro areas surveyed. This, along with a median family income below the U.S. median income, has led to cheaper home prices. The high unemployment rate could depress the housing market for some time. Median home prices are only expected to rise by 2.4 percent in 2013, less than the 5.0 percent price increase expected nationally. However, between 2012 and 2017, home prices are expected to grow at an annualized rate of 4.2 percent, besting the U.S. rate of 3.9 percent.

2. South Bend, Indiana-Michigan

  •  Home price as percent of family income: 121 percent
  •  Median home price: $69,000 (second lowest)
  •  Median family income: $57,300 (55th lowest)
  •  Unemployment: 8.6 percent (66th highest)

South Bend has been more fortunate than other metropolitan areas in terms of avoiding housing market damage. Furthermore, home prices only dropped by 8.2 percent from their peak, or less than a quarter of the drop in prices nationwide. Still, the area suffers from above average unemployment rate at 8.6 percent. The median monthly mortgage payment for a house in South Bend is only 5.52 percent of the median monthly income. This is the only metro area in the United States, besides Detroit, where mortgage payments are less than 6 percent of median income.

1. Detroit-Livonia-Dearborn, Michigan

  •  Home price as percent of family income: 79 percent
  •  Median home price: $41,000 (the lowest)
  •  Median family income: $51,900 (19th lowest)
  •  Unemployment: 10.6 percent (23rd highest)

While home prices were already cheap in Detroit before the housing downturn, they became even cheaper after. Home prices between the first quarter of 2007 and the first quarter of 2012 fell a whopping 53.7 percent, or 14.3 percent annually -- the 10th-largest drop of all metro areas surveyed. With a median home price that is $28,000 lower than any other metro area reviewed, a median mortgage payment is only 3.6 percent of monthly income. Home prices are expected to stay cheap for a while, rising only 3.8 percent on an annual basis from 2012 to 2017, below the 3.9 percent annual growth in home prices across the United States. While home prices rose faster in Detroit than in any other metro area in 2011 at 8.6 percent, prices are expected to fall an additional 10.7 percent this year, more than any of the other 198 metropolitan areas surveyed.

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