I live in the beautiful state of Colorado. We have the mountains, we have the rivers, we have the breweries.
We also have outrageous home prices.
The June 2024 Rocket Homes Housing Market Report published that the median sold price in Denver, CO was $619,194. I don’t know if this makes you feel better or worse, but that’s down $22,869 since June 2023.
If you’re in an area that has seen home prices skyrocket, here are some ideas to help you get into the housing market.
Explore Affordable Financing Options
Increased mortgage rates have had many people staying where they are and waiting until there’s a decrease. According to Yahoo Finance, “High interest rates over the past months have paused buyers and sellers. Compared to the pandemic-era interest rates of 3% or less, rates under 7% are still high. But if you look at the historical average, it’s actually a fair rate. Compared to 1981’s interest rates above 18%, it’s actually low.”
Here are some other options to consider:
- FHA loans are government-backed and designed to help first-time homebuyers and those with lower credit scores, often requiring lower down payments.
- VA loans offer competitive interest rates and do not require a down payment if you’re a veteran or active-duty service member.
- Many states and cities also offer first-time homebuyer programs, grants, and low-interest loans, so research what’s available in your area to find the best options for your situation.
Consider Alternative Buying Strategies
In a high-cost-of-living area, traditional home buying might not always be feasible. One alternative is co-buying, which involves teaming up with friends or family to purchase a property, making a better home more affordable. Just ensure that all parties have clear agreements regarding finances and responsibilities.
Another option is purchasing fixer-uppers, as homes that need renovation are often priced lower. With some work, these can be turned into your dream home, but make sure to factor in renovation costs. Additionally, suburban and rural areas often offer more affordable housing options, and with the rise of remote work opportunities, these areas have become more attractive.
Be Patient and Persistent
The journey to homeownership in a high-cost-of-living area can be long and challenging. Stay focused on your goal and be patient. Market conditions can change, and being ready to act when the time is right can make all the difference. Keep an eye on the housing market trends and interest rates, subscribe to real estate newsletters, and work with a knowledgeable real estate agent. Sometimes, compromising on certain aspects like location, size, or type of home can make a significant difference in affordability.
Work with Professionals
Enlist the help of experienced professionals to navigate the complexities of buying a home. Real estate agents have in-depth knowledge of the market and can help you find the best deals. Financial advisors can assist in creating a financial plan that aligns with your homeownership goals, and mortgage brokers can help you find the best mortgage options tailored to your financial situation.
If you’re overwhelmed looking at Zillow, you’re not alone. Buying a home is a major decision and can be very stressful. Just remember that you do have resources available – and I’m one of them! If you’re thinking about a major purchase, but want to make sure you’re financially ready, CLICK HERE to make an appointment.
The information being provided is strictly as a courtesy. When you link to any of the web sites mentioned, we make no representation as to the completeness or accuracy of information provided at these web sites. The opinions found therein are those of the author(s) of the article or website.
