Here’s where first-time buyers can afford to buy a home around the country.
Lending Tree recently released research on the top cities that still offer first-time buyer affordability. The best cities for first-time homeowners include Pittsburgh, Cleveland, and Oklahoma City.
Lending Tree crunched the numbers by ranking the country’s 50 largest metros looking at down payment amounts, down payments as a percentage of purchase price, share of affordable homes to median income families and the percent of buyers with credit scores below 680.
“The first-time buyer has fewer financial resources than the move-up buyer who can use equity towards their down payment,” notes Lending Tree’s chief economist Tendayi Kapfidze. “Because they have those financial resources, they are a stronger buyer. Our research shows it’s easier to become a homeowner in rustbelt cities,” he adds.
Pittsburgh and Cleveland both tied for first place with Oklahoma City behind in third place. According to Lending Tree’s research, Oklahoma City, Cleveland, and Memphis have the lowest down payments, averaging $32,000. That’s lower than the average down payment in the 50 top metros, Lending Tree looked at. Good news for first-time buyers.
First-time buyers Laura and Rob Bray of Pittsburgh are happy with their recently purchased home. After renting a one-bedroom apartment for a few years the couple wanted more space, but rental prices were rising. “We decided to start looking to buy a house. We knew we wanted to stay in the city and not go out to the suburbs,” explains Laura.
They found a recently renovated 4-bedroom, 3-story home with a small backyard in the hot Pittsburgh neighborhood of Lawrenceville, a mix of younger couples, families and longtime residents. It was listed at $325,000 and they paid $305,000 after a bit of negotiating.
Today, a totally renovated and updated 1,361 square foot home in the heart of Lawrenceville is listed for $324,900. Features include a brand-new kitchen with granite counter tops, central air conditioning, and landscaped backyard.
In Pittsburgh, according to Lending Tree’s findings, an average down payment is $34,049. A surprisingly 41.3% of Pittsburgh buyers had credit scores below 680, also good news for first time younger buyers.
Heading to Cleveland where the average down payment is $32,775, you can find a for sale by owner listing on a brick Tudor in the desirable West Park area for $264,900. Built in 1934, the home has the original charm with a wood-burning fireplace, crown moldings, and built-in china cabinets.
In Oklahoma City, where the average down payment is $30,234 and 13% as a percentage of the purchase price, there are good affordable choices. A large 3,252 square foot home with an “owners suite” with a spa bath and heated shower floors is listed at $263,000.
When home buyers are used to looking in the major metro areas, both on the east and west coast, they cannot believe prices like these exist. For first-time buyers wanting to put down roots and own an affordable home, these cities are worth looking at.