There is a certain excitement that comes along with buying a new home, but there is also a bit of fear and anxiety. Can you afford it? Can you make the payments and still enjoy your life? Can you afford a down payment? What is the price of a home in your area? Can you afford what you really want and if not, should you buy something that needs some work or just wait until you earn more or house prices fall? There are a lot of variables to consider, and right now it might help you to learn what you can afford and what you cannot. Of course, what you can afford depends not on what a bank tells you that you can afford but what you know you can afford when you factor in your insurance, car notes, day care expenses and all the other expenses you have.
If you want to buy a home, though, you might want be interested in learning how much money you need to buy a home in certain parts of the country. We have an example for you that might just shock you significantly. This information is courtesy of the US Census Bureau, and it is providing examples only for single homebuyers with excellent credit, a 20% down payment, a 4% interest rate and a 30-year mortgage.
Pittsburgh is the cheapest major city in the USA for buying a home. All you need to make as a single person to afford one of the average $128,000 homes in this city is an annual income of approximately $31,000. That’s not much, and that’s actually very affordable. In New York, though, you need to make more than double that as a single buyer. The average home price there is $384,000 and that requires you make at least $86,700.
San Francisco is the most expensive city in which to live, and it requires that you have an annual income of at least $147,000 to afford the average cost of a $781,000 home. Of course, there are always options just outside the city, in smaller towns and suburbs that are far cheaper and still allow you access to the city from your home if these prices are scaring you just a bit.
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