Love Where You Live – How to Afford to buy a Home in your favorite neighborhood
In today’s real estate market purchasing a home in an in demand neighborhood can feel out of reach for first time home buyers. Bidding wars and limited availability intimidate many eligible buyers into continuing to rent when their money could go much further on a mortgage payment. In addition to saving money in the short term, homeownership lends itself towards equity and long term returns on investment.
- Alternative Mortgage Products
Now more than ever before the real estate market offers feasibility for first time buyers. Many new products offer as little 0-3% down. With mortgage loans averaging $500 per each $100,000 borrowed, based on average interest rates owning is more viable than renting regardless in most neighborhoods.
- Buy A Multi Family Home
Buying a multi family home is a great way to increase affordability and offset ownership costs. A multi family home is any property that includes 2-4 units. These listings are ideal for budget minded buyers. In some cases, owners can live on property and generate enough income through renting the remaining units to reduce or eliminate their own mortgage payment.
- Rent To Own
Another great approach to living in your preferred neighborhood while staying in budget is the rent to own strategy. Some enterprising sellers are more than willing to let tenants rent and use a portion of that rent to put towards a down payment to eventually buy that property. Rent to own is particularly attractive to current renters that would like to migrate towards ownership over a longer period of time. As with all financial dealings, it’s important to consult with a professional before entering into a rent to own agreement with an owner or landlord to make sure it’s usable when applying for financing.
With the right approach and a reasonable compromise, owning a home in a neighborhood you love is practical, possible and easier than you think.