Is life under $2500 a month possible in Utah for 2023?
In our current market, with home prices holding steady in the "borderline unaffordable" range, and the interest rates standing tall around 6%, is it even possible for a normal person to be able to buy in Utah? We have seen the housing prices soften slightly in the last 12 months, but not in a way that makes it easy to be able to afford a monthly mortgage payment at the current interest rates. It is getting more and more difficult to find a deal that would allow a renter to become a homeowner. It is even harder to find an opportunity for someone who doesn't have much of a downpayment to be able to ever break into the real estate market as a buyer.
There is a way! We've researched the possibilities in the market with the current inventory and financing deals available to buyers. The short version is, yes. The long version? It may look different than what you've been thinking about for the last couple of years. You are not looking for your forever home. Instead, you are looking for your "break into the market" home. Let's go over a couple of options that will let you buy a house, build your networth with home equity, and stop throwing thousands of dollars away to your landlord while staying under $2500 a month for a mortgage!
Option 1 is: Getting at least a 3 & 1/2% downpayment stored up. FHA loans are coming back in a strong way. And those buyers who are strapped for cash, can still find a 3 bed/1.5 bath single family home in the Salt Lake Valley for $350,000 or less. That means if you can save up $12,250, you can buy a house in Salt Lake! Not only that, but your monthly mortgage payment can be under $2500 as well. As you put more money down, it only gets cheaper monthly. Buyers don't have to have at least 20% downpayment saved up and have to offer over list price anymore just to get under contract. Is it the home of your dreams? Probably not, but it is an opportunity to start building equity and invest in yourself. So when it comes time to sell in the future, you get to have a nice down payment on your next home!
Option 2 is: Get help with your down payment. Maybe you don't have the cash to put down enough money for 3 & 1/2% of a home. There is a sacrifice in everything. So, if you are willing to add a commute to your daily life, some cities that are further away are offering grants for first-time homebuyers to help with your down payment! Just because it is not where you "want" to be longterm, it doesn't mean that it is not a good investment for your future. Sacrificing on location brings benefits like getting into a home for the first time while spending approximately a month's rent for a down payment. Another upside?? You are still all in with a mortgage payment that is under $2500 a month! Remember, this is about you being able to become a homeowner and start investing in your future.
There are other options that will get you the same result of life in Utah as a homeowner under $2500 a month. As hard as this market is, it doesn't have to stop someone who is suffering from having to rent, to instead buy and pay themselves a monthly mortgage check. Sure, your path to your forever home and where you want to ultimately be may be different, but the ability to save on taxes, build equity, invest in your future downpayment by selling your first home, and gaining your independence is not out of reach.
There are multiple ways that we know of to help you reach your goals. Stop hesitating and giving yourself the excuse that it is too hard. Reach out to us and share your goals. Let us help build you out a plan for success, and be willing to learn how to stop spending thousands of dollars, and start saving thousands.