Florida is a location of prime real estate which demands a certain level of budget from any prospective homeowner. There is a fixed range in which one can expect the modest to be depending on the neighborhood and other amenities. It is not worthwhile to take a loan for the first down payment because of high interest which is why a certain income or saving or important before going house hunting in the state.
The monetary concerns while making the final purchase should not be taken for granted. In this article, we will be talking about buying a house and Florida and how much one needs to earn to make the purchase successful.
The Median Home Price
There has been a 32% increase in the median home price of a property in Florida. Due to this increase there has been a change of expectations in the banks before people go and get pre-approved for a home loan. Given the increase in the median price, the banks expect a certain level of increase in the average salary for the loan applicants.
All around the nation, there has been a significant increase in real estate prices. If we compare the median growth in prices of Florida to other states, it is not as drastic. However, it still poses a problem because the increase in income is not able to match the increase in the median price range of real estate properties.
The Figures
Now that we have outlined the general scenario of increasing real estate prices, we can jump to specific figures. The metropolitan areas of Miami-Dade and Palm Beach have seen a sharp spike in the price range which now touches 353,000 USD. Foreign individuals can afford a property worth that much, the median salary is expected to be more than 78,000 USD.
These are shocking figures especially if compared with what was required before to be a homeowner in Florida. Previously for buying a house ranged around 260,000 USD, an individual making about 60,000 USD could afford the down payment. One also needs to consider other factors relating to getting pre approved for a loan.
There is the possibility that a married couple would want to take a loan and buy a house as a joint agreement. In such a case banks are looking for two people who own nearly 40,000 USD per year. The definition of financial stability has changed in the past 6-7 years with the median income increase. In 2015, Florida was one of the most coveted locations because of relatively cheaper real estate in the metropolitan area.
Because it was a place with the second lowest property rate, people flocked to the market. This is probably the reason why the rise and price is becoming very difficult to comprehend today. The metropolitan areas of Florida are still not the most expensive in the country which may give prospective homeowners a sigh of relief. Experts predict that there might be a chance of a spike in expenses in the near future.
How to Get a House in Florida?
We have already established that a certain level of median salary requirements are to be met before starting with house hunting. Even if one gets pre-approved for a home loan it is best to give a down payment out of your own pocket rather than taking a loan for it. Saving for a down payment is important because it is usually 20% of the asking price.
One can find lenders for the down payment but the interest will be significantly higher than that of the mortgage. For instance, if the price of the home is somewhere around 356,000 USD, the down payment will come to around 71,000 USD. Buying a House in Florida can be made easy if you have the right help by your side, so make sure you contact alecsalameh.com today.
Any expert will recommend saving in advance and looking for houses within the budget of how much down payment you can afford. There are down payment assistance programs for people who need some extra help in paying for the house of their dreams.
Choose the Right Locality
Be open to exploring different areas of Florida based on the amenities and nearby locations. Ideally, a house should be closer to a hospital, a grocery store, a school and recreational center. We have already established that metropolitan and urban areas are on the higher end of the price spectrum which can lead to difficulties in getting pre-approved for a home loan.
So the right locality is dependent on the budget of the homeowner. If there is a slight fluctuation between your budget and the coated value of the property, do not worry. There are always chances of negotiating a better deal because it all depends on how well the property is and whether or not there are any issues that come up during inspection.
This trick might work for houses closer to your budget but try not to fly too high if you do not have the funds. The local lifestyle plays a big role in raising the price of a property. For instance, a working owner might look for better ways of commuting and nearby train/bus stations. A family moving to Florida will look for a school district and other related amenities. The crime rate also varies from location to location which is important to see for every prospective buyer.
The Takeaway
There are very specific expectations out of homeowners looking to get free approval for a loan. It is obvious that one would want a higher median salary to get surety that the money would be paid back. This increases the pressure on homeowners who have to save for a down payment and subsequently for mortgages. Proper planning is therefore necessary before one even considers going to an open house. Ensure having a budget before starting.
