In the Market: Home affordability mapped
This weekly feature is a real estate news and information roundup from a millennial’s point of view. When a young professional moves from Indianapolis (median home price $125K) to San Francisco (median price $1 million), you can expect an adventure. Nneka Madus, an analyst in Bank of the West’s Mortgage Division, did just that and has plenty to share in her quest to own a home in San Francisco.What’s it take to afford a home in your city? Ana Swanson has put together a nice map in the Washington Post that estimates the income that may be needed to purchase a median-priced home in 27 major metro markets in the United States. Take these numbers with a grain of salt and keep in mind these types of calculations make certain assumptions about how much buyers put down, what’s happening with interest rates, and the type of mortgage used to purchase a home. You’ll see a wide range of affordability across the map, which isn’t surprising, but prospective buyers can’t really know what they can afford with their income until they get a preapproval from a lender based on their full financial picture. If you’re having trouble paying your mortgage, my suggestion is to contact your lender as soon as possible. If you decide to go an alternate route, such as using a “mortgage rescuer,” you may want to read Stephanie Zimmerman’s article in ABCNews. “Mortgage rescuers” are companies that offer to help struggling homeowners modify their loan. Stephanie points out that many American homeowners have lost money to mortgage modification scams, so be on guard. Stephanie lists three red flags to watch for borrowers considering working with an outside company to modify a mortgage. For more info, check out the Consumer Financial Protection Bureau’s post on mortgage modification scams. What do millennials want? That’s a popular question these days. Goldman Sachs published a really cool animated graph that illustrates millennials’ spending profiles. The graph covers our housing goals versus where most of us are right now; the graphs are interactive and very easy to quickly read. As much as I dislike being labeled and defined, the authors pretty much hit the nail on the head with this infographic. What do you think? How well do the graphs correlate with your financial situation?