Cash-strapped buyers keen on a red-hot housing markets should hunt in these 11 budget-friendly areas
With homes in America’s hottest markets typically selling for $500,000 and in many cases much more, first-time buyers and other bargain-hunters are struggling to find properties within their budgets.
With that in mind, real estate company Point2 has hunted down the suburbs and commuter towns within 30 miles of desirable markets, such as New York, Miami, and Boston, where homes are much cheaper.
They found scores of suburbs where buyers could spend 50 percent less per square foot of real estate than they would be paying a few miles away in the nearby property bubble.
‘In some of the most desirable cities in the nation, the outlook is grim,’ researchers said.
‘Suburbs may still provide the silver lining that all aspiring homebuyers are looking for.’
Researchers have identified 11 bargain suburbs where prices are much lower than in the nearby major city
Those willing to widen their search could find something ‘more spacious, or much cheaper,’ they said.
They could dodge the ‘bludgeoning’ effect of high prices and months of runaway inflation, which have pushed up costs of everyday basics and eaten into household budgets, they added.
In their study, they revealed the 11 suburbs where the price per square foot was between 60-65 percent cheaper than it was in the nearby city.
The list could be seen as America’s best real estate bargains.
Medley, Florida, tops the rankings.
It is only a 20-minute drive to downtown Miami, but this mostly Hispanic and Latino neighborhood offers homes that sell for 65 percent less per square foot than do those only a few miles away.
Bargain hunters generally fare better on the East Coast.
Many of the best-priced suburbs were outside New York City.
They include Emerson, Lodi, Moonachie, Passaic, and Paterson — all in New Jersey — as well as Mount Vernon, in New York state.
Outside of Washington, DC, budget-conscious buyers should probe Huntingtown and Waldorf, in Maryland.
Bostonians seeking a bargain can try heading 30 miles up the I-93 to Lawrence.
Only one West Coast suburb makes it onto the list.
In Boulevard Park, Washington, homes sell for 61 percent less per square foot than do those a 20-minute drive away in downtown Seattle.
Paterson, New Jersey, and its City Hall. Prices there are 60 percent cheaper than they are in nearby New York, where many residents travel for work
For the study, researchers focussed on the country’s most expensive property markets and looked for better prices in the suburbs within 30 miles
Fewer properties are hitting the market and high mortgage rates make push up costs for borrowers
The survey comes at a tough time for cash-strapped buyers, with the average long-term mortgage rate hitting its highest level this week since mid-March, driving up borrowing costs as fewer properties go on the market.
The average for a 30-year, fixed loan was 6.57 percent, up from 6.39 percent last week, Freddie Mac, the Mortgage Bankers Association and the Federal Housing Finance Agency said in a statement. With the average rate 5.10 percent a year ago.
High rates can add hundreds of dollars a month in costs for homebuyers, limiting what they can afford in a market that has become increasingly unaffordable after years of soaring home prices and limited homes for sale.
Meanwhile, current owners are reluctant to move and trade up from their historically low mortgage rates — as new construction is making up an increasing share of transactions.
‘The US economy is showing continued resilience which, combined with debt ceiling concerns, led to higher mortgage rates this week,’ said Sam Khater, Freddie Mac’s Chief Economist.
‘Dampened affordability remains an issue for interested homebuyers and homeowners seem unwilling to lose their low rate and put their home on the market.
‘If this predicament continues to limit supply, it could open up an opportunity for builders to help address the country’s housing shortage.’
