Are you a first-time home buyer? Are you thinking of buying a home in Indianapolis? Well, good news: According to a new report from the real estate site Zillow, Indianapolis is the best market in the country for first-time home buyers.
First-time buyers can choose from a high inventory of available homes in Indianapolis, and they don’t have to compete with lots of other buyers. According to Zillow, the median home value in Indianapolis is $130,200, so the average home buyer will spend 11% of their monthly income on a mortgage payment. In comparison, renters in Indianapolis can expect to spend 26% of their monthly income on housing.
To determine its list of the 10 best markets for first-time home buyers, Zillow looked at:
- Median home values. Lower home values mean it’s easier for first-time buyers to save for a down payment.
- Affordability. A comparison of the medium income versus the median mortgage payment.
- Inventory. When more homes are for sale, buyers can look for the perfect home.
- Cash buyer competition. Fewer all-cash offers equals less competition.
According to Zillow Chief Economist Dr. Svenja Gudell, “Buying your first home is a big decision that takes a lot of planning. First-time buyers across the U.S. are up against high prices and low inventory.”
However, in Indianapolis, the availability of affordable, entry-level homes is less of an issue. Therefore, first-time home buyers shouldn’t have to deal with high prices and very many bidding wars. Also, you’ll be able to find a home that fits your needs.
As for down payments, some other things you should know are:
- FHA allows you to use gift money for a down payment of only 3.5%. Additionally, if you qualify, there is a down payment assistance grant program that actually gives you up to a 5% grant to use toward your FHA down payment and closing costs. The best thing – you don’t need to pay back the money.
- A down payment for a conventional loan is 5%, however, you can use gift money for this type of loan.
- If you purchase a home in a qualified rural area (some areas in the counties surrounding Indianapolis still qualify) with a USDA home loan offered through the USDA Rural Development Guaranteed Housing Loan Program, you don’t need to put any money down, and this type of loan has generous income guidelines. But, as noted, a USDA loan does have location restrictions.
Therefore, after considering all of the above and the fact that mortgage rates are at a record low, now is a good time for you to think about buying a home in Indianapolis. If you need help getting pre-approved for a mortgage loan, contact the home loan experts at Grandview Lending. As a mortgage broker, we offer several mortgage programs depending upon your needs. Our mortgage specialists will work with to ensure your loan experience meets your complete satisfaction. Call us today at 317.255.0062!
Photo credit:123RF / rudi1976
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