Today’s housing market is historical, and not in a great way. Inflation and interest rates have us all changing our plans about what we can afford to dream about and what we have to give up for practical purposes.
For many, having a house and owning property is a lifelong goal. While today, it may seem more out of reach than ever, don’t let the Fed’s interest rates cancel your plans just yet.
Here are four ways you can still afford to turn that dream into a reality.
1. Think International
For many, the idea of moving out of the country is a hard pass. To others, it’s an exciting opportunity. If you’re in the latter group, considering different locations around the globe can open up a new world of affordable interest rates and house prices.
Consider, for example, luxury real estate in Costa del Este, Panama. The country is renowned for its beauty, and the cost of living is still reasonable. On top of that, their currency is USD, making your transition that much easier.
If you don’t have a lot of strings holding you down in the US, moving across borders can improve your quality of life and not hemorrhage your savings account.
2. Downsize
Housing prices are skyrocketing faster than a Lear Jet. The average home sale price surpassed $400,000 for the first time in US history in May 2022. That’s a 14.8% increase from only one year ago. For most Americans, that price hike is simply unaffordable.
Consider condos if you’re not ready to buy a 3,000-square-foot house. If you don’t need as much space but are ready to stop paying rent for the rest of your life, a condo can be a fantastic, affordable investment.
3. Rocking the Suburbs
No matter how much money and equity you have, it’s doubtful that you’ll end up in your first-choice property. With that in mind, it may be time to broaden the perimeter of your home search.
The price of homeownership inside a city has increased dramatically, while the price hike is much less drastic outside of it.
Cities have more inbound movers, so the buying market is highly competitive. Broaden your search, and take a look at the surrounding suburbs. Look at the price differential, and your path to ownership might seem possible again.
4. Financial Grants & First Time Buyers Assistance
Depending on your work or buying history, financial assistance may be available to you. If you’re a first-time homeowner, a wide array of grants are available.
In 2021, Congress passed the Downpayment Toward Equity Act. This grant for first-time homebuyers provides funding for people of socio-economically disadvantaged backgrounds.
If you’re a Veteran or an Active Duty service member, you will likely qualify for loan assistance through the Veterans Affairs Bureau. Before throwing in the towel, it’s always a good idea to search for help.
Final Thoughts
The global economy is shifting rapidly in the post-Pandemic world. While it may seem daunting, homeownership is still an excellent investment in your future. By making a practical assessment of your finances and using these four tips, you can find the house that’s just right for you.
