Taking action to find affordable housing
CINCINNATI (WXIX) - As the pandemic-era housing boom continues to rage with home prices setting records and rising rent prices further stretching budgets, Bankrate data shows that 58% of U.S. adults would be willing to take action to find more affordable housing.
The solutions include moving out of state, moving farther from family and friends, buying a fixer-upper, moving farther from work, and moving to a less desirable area.
According to Bankrate, 75% of Gen Z (ages 18-25) and 69% of Millennials (ages 26-41) would consider at least one of these actions, compared to 59% of Gen X (ages 42-57) and 41% of Baby Boomers (ages 58-76).
However, there are tradeoffs to consider when deciding whether to make a cost-saving move, cut corners in the homebuying process, or stretch your homebuying budget.
- Moving to a cheaper area: 27% of U.S. adults said they would be willing to move out of state to find more affordable housing. Additionally, 20% would move farther from family and friends, 13% would move farther from work, and 11% would be open to moving to a less desirable area. The rise of remote work makes affordability-driven migration more attractive. However, most expensive markets have rewarded homeowners through robust appreciation. Cheaper markets, while enticingly affordable, create less housing wealth. You’ll also potentially have to leave behind family and friends and the support they offer for things like childcare.
- Buying a fixer-upper: 21% would be open to a fixer-upper to find more affordable housing. For buyers frustrated by the lack of inventory and rocketing prices, older homes can be a good compromise. However, no matter how careful you are about estimating your renovation budget, you can count on surprises – especially in a time when materials costs are volatile and construction labor is in short supply.
Potential Homebuying Pitfalls:
- Waiving inspection: To waive the typical inspection contingency without getting burned, be sure to reserve the right to conduct an inspection for the purposes of gathering information. This means, in a competitive market, waiving the home inspection contingency without waiving the inspection itself. The idea is that you don’t want to ask the seller to pay for minor touch-ups, but you also don’t want to unwittingly buy a house that needs tens of thousands of dollars in repairs.
- Entering a bidding war: To avoid getting caught in the emotions of a bidding war, go in with a plan. In the heat of battle, it’s easy to boost your price by a lot just for the sake of trying to win. Before you get into a bidding war, set a clear ceiling on the amount you’re willing to offer for the property and stick to it.
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