Ideally, you will be able to purchase a home where you live. However, a competitive housing market and high costs of living can be problematic. Still, purchasing a home is better than renting. Here are practical tips to help you afford your first home in your area.
- Save for your down payment.
A larger down payment will allow you to get a house that fits your needs. It will also lower the amount that you have to borrow. Put all your extra money towards the down payment, and if possible, live with roommates or pick up a side gig to increase your savings.
- Find a property with a rental.
It is smart to pick a home that will allow you to rent a part of it to help cover the mortgage. This is particularly useful if you live in an area with high cost of living. If you go down this route, make sure you have saved a few months of your mortgage as an emergency fund to cover the time between renters and any repairs that you may need to take on.
- Check out your options in other areas.
If you live in an expensive city, consider looking beyond it for more affordable housing options. The commute may be longer but the savings may be worth it. Another option is to look for a job in an area with a lower cost of living. You may be able to find a home you like at a much cheaper price.
- Look at a fixer upper.
If the prices of homes in your area are ridiculous, consider getting a property that needs to be fixed up. The key is to find one that you can live in while you renovate it. You will also need money for the renovations. You can DIY to raise the property value of your home fast. Just make sure everything is up to code and leave important work like electricity and plumbing to the pros to avoid accidents.
- Apply for a home buyer’s assistance program.
Check out HUD and USDA for assist programs that can help you qualify for a mortgage. Many states and counties also have assistance programs that you can use to help with a down payment or closing costs. See what is available near you then expand your search nationwide.