Map Shows Where Homebuyers Can Still Buy Homes for Under $300K

Newsweek

3 hours ago

Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources.
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While a majority of U.S. homebuyers are facing sky-high prices and historically elevated mortgage rates, there are places across the country where it is still possible to find a home for under $300,000, according to recent data shared by Realtor.com.
Why It Matters
The median sale price of a typical home in the United States before the COVID-19 pandemic was under $300,000, but has since climbed to well above $400,000. In April, the latest data available from Redfin, the typical U.S. home would cost buyers a median price of $437,864, up 1.3 percent from a year earlier.
Historically elevated mortgage rates and skyrocketing prices—a consequence of the pandemic-driven homebuying frenzy, as well as the chronic shortage of homes that has plagued the U.S. market for years—have pushed many Americans to the sidelines, hurting first-time homebuyers the most.
According to the National Association of Realtors (NAR), the U.S. market needs 367,000 more home listings at a maximum price of $170,000, 416,000 more priced at or below $255,000 and 364,000 more priced under $340,000 to fix the existing affordability gap.
However, if you know where to look, there are still pockets of the market where buying a home can be more affordable, especially in areas where inventory is rising the most.
What To Know
The most affordable cities in the country are concentrated in the Midwest and the South, according to the company's report. Several major cities, including Detroit, St. Louis, Memphis, Baltimore, Indianapolis, and Pittsburgh, enter the 145-city-strong list of places where a typical home costs $300,000 or less.
Among the biggest cities with the most affordable home prices are:
Detroit, MI ($109,000)
Birmingham, AL ($181,500)
St. Louis, MO ($199,999)
Memphis, TN ($218,200)
Baltimore, MD ($249,900)
Lubbock, TX ($249,975)
Indianapolis, IN ($268,500)
Pittsburgh, PA ($274,900)
Decatur, GA ($279,000)
Kansas City, MO ($281,250)
Oklahoma City, OK ($285,855)
Louisville, KY ($289,900)
Tulsa, OK ($289,900)
Baton Rouge, LA ($289,945)
Philadelphia, PA ($289,999)
El Paso, TX ($295,000)
Columbus, OH ($295,900)
Clearwater, FL ($299,250)
Jacksonville, FL ($299,900)
Myrtle Beach, SC ($299,900)
Ocala, FL ($299,999)
San Antonio, TX ($300,000)
Some of these cities have experienced a rapid home value appreciation during the pandemic, and even as prices remain relatively low compared to the national average of more expensive metros, they may still be unaffordable for locals.
According to Realtor.com, a monthly payment for a 30-year fixed loan at 6.8 percent on a Detroit home, with a median list price of $109,000, would cost a homebuyer roughly $762 a month "after taxes, insurance, and interest, and with a 20 percent down payment of $21,800," the company wrote.
While affordability is rare on the East Coast, with the Northeast still experiencing acute housing shortages, homebuyers can find homes under $300,000 in cities such as Philadelphia, Pittsburgh, and Baltimore.
What People Are Saying
Hannah Jones, senior economic research analyst at Realtor.com, said: "The majority of these cities are in the South or Midwest. These regions tend to offer more affordable homes as they have generally more space to grow and lower demand than a high-density city (such as New York or Boston)."
Of the affordable cities on the East Coast, she said: "Some of these cities, such as Detroit or Baltimore, have gone through challenging periods. However, recent investment and growth have put them back on the map as appealing, affordable places to put down roots."
What Happens Next
While homeowners continue to struggle with high mortgage rates and rising housing costs, recent trends in the U.S. housing market suggest that the rapid growth in home prices that has characterized the last five years is slowing, and may even be reversing.
The number of homes for sale in the U.S. is now near pre-pandemic levels, while in some parts of the country, especially in Southern states like Texas and Florida, which have built the most new homes over the past few years, they are even higher.
Most importantly, much of this rising inventory is sitting idle on the market because buyers just cannot afford it or think it is worth waiting to see how things might turn out in a few months.
The result is that sellers, who now outnumber buyers by an estimated 500,000, according to Redfin, are increasingly being forced to lower their asking prices to attract reluctant buyers. This downward pressure on prices could finally turn the U.S. housing market solidly in favor of buyers, although stubbornly high mortgage rates and other rising housing costs might stop them from fully enjoying this change.