Out of the 15 largest cities in the country, SmartAsset recently named Philadelphia one of the most affordable.
If a household has a 20 percent down payment saved, which costs $27,000 on average, an income of $24,465 should be sufficient to make the monthly payments of $734, the median mortgage in the City of Brotherly Love.
“While we didn’t specifically look at why Philadelphia is affordable, it is one a few cities on our list that is affordable for people with incomes less than $30,000. Given that the U.S. Census Bureau’s 2015 5-Year American Community Survey found the median income in Philadelphia is $38,253, this could be great news for Philly residents,” said SmartAsset’s VP of Conent AJ Smith.
However, saving 20 percent for a down payment may not be doable for all residents. “We did not consider what would happen if a 20 percent down payment was not saved, since this is the suggested amount to put down when buying a home. If the down payment drops below the 20 percent threshold, prospective homebuyers may need to consider additional options, which can translate into more costs,” said Smith.
Something else homebuyers should keep in mind is how much property taxes will set them back, especially in larger cities. “While most people focus on mortgage payments, property taxes can have a large impact on home affordability. In cities like Austin and New York City, real estate taxes can add hundreds to monthly home payments,” he said.
“Although property taxes and homeowners insurance in Philadelphia are more affordable than in many other big cities, factoring those costs into monthly mortgage payments is still an important part of determining how much home you can afford,” added Smith. SmartAssest offers a mortgage calculator that can help your clients estimate their monthly home payments.