Should You Buy an Affordable Home in the Suburbs?

Drive until you qualify. It is an old adage in the real estate industry that basically describes driving farther out of town until you reach home prices that are affordable to you. With today’s hot housing market, you may be priced out of homes closer to the center of town. Even if you can afford to find a decent house in that area, it may be at the top of your budget. Do you really want to stress your budget unnecessarily?

Homes in the suburbs are generally more affordable on a per-square-foot basis. These communities are once again gaining popularity as many urban home prices reach unaffordable and astonishing levels. With many people now working from home, living in the suburbs does not mean making a long daily commute for some people. Plus, you may find better schools, great parklands and other amenities that improve your overall quality of life.

While the suburbs have strong appeal, there are a few potential downsides to consider before you drive out of town to search for a new home. For example, in a downturn, suburbs have historically taken the brunt of the storm. This is because they tend to attract the same types of buyers. These are buyers who are looking for a great deal on the largest and nicest home that they can afford. Unfortunately, the real estate market is cyclical. When the market takes a downturn, a low-down-payment buyer may be at a greater risk of foreclosure. This means that suburbs overall may have higher turnover rates in a downturn. Adding to the stress, these communities may be in less demand during a downturn compared to homes closer to and in town.

Are you trying to decide if you should drive out of town to buy your next home? At MortgageDepot, we want you to have all of the facts in hand before you make your buying decision. Contact us today to get prequalified for a mortgage and to explore your financing options.

Connect with one of our loan consultants to learn more.