{"id":11858,"date":"2019-10-24T05:09:58","date_gmt":"2019-10-24T05:09:58","guid":{"rendered":"https:\/\/wp.nootheme.com\/citilights\/?p=11858"},"modified":"2019-10-24T05:10:00","modified_gmt":"2019-10-24T05:10:00","slug":"how-to-actually-afford-to-buy-a-home","status":"publish","type":"post","link":"https:\/\/wp.nootheme.com\/citilights\/how-to-actually-afford-to-buy-a-home\/","title":{"rendered":"How to Actually Afford to Buy a Home"},"content":{"rendered":"\n<p>Home buying hurdles exist \u2014 but research, creativity and flexibility will help you clear them.<\/p>\n\n\n\n<p>Home buyers today face tough challenges \u2014 housing prices have soared, a dollar doesn\u2019t go as far as it once did and rent is more expensive than the past.<\/p>\n\n\n\n<p>How are people today making such a large purchase despite these hurdles? With more flexibility and a bit of financing creativity, today\u2019s buyers are finding ways to achieve homeownership.<br><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Know your options (and credit score)<\/h2>\n\n\n\n<p>The first step to knowing if you can afford a home is figuring out what financing options are available to you, including what mortgages you\u2019re eligible for and how much you need (and can afford) to put down upfront.<\/p>\n\n\n\n<p>Learning the minimum FICO score required by lenders and understanding your own credit score are important starting points.<\/p>\n\n\n\n<p>Many home shoppers aren\u2019t sure how much they have to put down on a home, what the lender-required minimum down payment will be (it\u2019s not always 20%), or what programs are available to help with down payments, like FHA loans.<\/p>\n\n\n\n<p>Before buyers even start thinking about saving for a home, they should\u00a0know what their financial resources are\u00a0and if they\u2019re eligible to buy.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Make enough money to save<\/h2>\n\n\n\n<p>With fewer resources to pull from than their older, wealthier counterparts, renters wanting to buy face tough financial headwinds.<\/p>\n\n\n\n<p>According to the\u00a0Zillow Group Consumer Housing Trends Report 2019, renter households typically earn a median income of $37,500 annually, which is nearly $40,000 less than the median household income netted by households who recently bought a home (of whom the median household income is $75,000 annually).<\/p>\n\n\n\n<p>While there are ways to enter into homeownership without making $75,000 in household income, it\u2019s hard to afford to buy if you make significantly less. \u201cIf you\u2019re making $37,500 per year, it\u2019s probably not feasible for you to buy in almost any market,\u201d says Zillow Chief Economist\u00a0Dr. Svenja Gudell.<\/p>\n\n\n\n<p>While households purchasing homes are more likely to have two incomes than renter households (and thus a higher median household income combined), even two-income households struggle to afford to buy in competitive markets.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Save enough cash (but not as much as you think)<\/h2>\n\n\n\n<p>One of the most daunting parts of home buying? The down payment. In fact, two-thirds of renters cite saving for a down payment as the biggest hurdle to buying a home, according to the\u00a0Zillow Housing Aspirations Report.<\/p>\n\n\n\n<p>For people buying the national median home valued at $229,000, with the traditional 20% down payment, that\u2019s $45,800 upfront \u2014 just to move in.<\/p>\n\n\n\n<p>\u201cThe down payment remains a hurdle for a lot of people,\u201d says Gudell. \u201cBut they should know they don\u2019t have to put 20% down.\u201d<\/p>\n\n\n\n<p>Although putting down less than 20% means additional considerations, such as the cost for private mortgage insurance (PMI), some find it worth the hassle. In fact, according to the\u00a0Zillow Group Consumer Housing Trends Report 2019, only one-fifth of recent buyers (20%) put 20% down, and just over half of buyers (56%) put\u00a0<em>less<\/em>\u00a0than the traditional 20% down.<\/p>\n\n\n\n<p>Buyers are also getting creative about piecing together a down payment from multiple sources. According to the report findings, 34% of buyers who get a mortgage also get help in the form of gifts or loans from friends and family to come up with a down payment.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Know your deal breakers, but be flexible<\/h2>\n\n\n\n<p>To get into a home \u2014 even if it\u2019s not the home of their dreams \u2014 some of today\u2019s buyers are considering homes and locations outside of their initial wish list and getting increasingly flexible when it comes to neighborhood, house condition and even home type.<\/p>\n\n\n\n<p>\u201cI do think people get discouraged when they look in their target neighborhood and they see homes around $170,000 when they\u2019re looking for a $110,000 home,\u201d Gudell says.<\/p>\n\n\n\n<p>Affordably priced homes do, in fact, exist. But in popular areas, where people most often want to live, it\u2019s going to be harder to find that cheaper home, Gudell says.<\/p>\n\n\n\n<p>\u201cIf you\u2019re willing to take a longer commute and make a couple trade-offs, you might be able to find a home that is farther out that might be cheaper,\u201d Gudell explains. \u201cYou have to leave the paved path before you can find cheaper choices.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Home buying hurdles exist \u2014 but research, creativity and flexibility will help you clear them. Home buyers today face tough challenges \u2014 housing prices have soared, a dollar doesn\u2019t go as far as it once did and rent is more expensive than the past. How are people today making such a large purchase despite these hurdles? With more flexibility and&#8230;<\/p>\n<div><a href=\"https:\/\/wp.nootheme.com\/citilights\/how-to-actually-afford-to-buy-a-home\/\" class=\"read-more\">Read More <i class=\"fa fa-arrow-circle-o-right\"><\/i><\/a><\/div>\n","protected":false},"author":1,"featured_media":11540,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[85,83],"class_list":["post-11858","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","tag-family-living","tag-home-staging","has-featured"],"_links":{"self":[{"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/posts\/11858","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/comments?post=11858"}],"version-history":[{"count":0,"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/posts\/11858\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/media\/11540"}],"wp:attachment":[{"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/media?parent=11858"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/categories?post=11858"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/wp.nootheme.com\/citilights\/wp-json\/wp\/v2\/tags?post=11858"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}