New report ranks Indianapolis most affordable city for first-year home ownership
INDIANAPOLIS (WISH) — A new report shows first-year home ownership costs are soaring, but Indianapolis remains among the most affordable among big cities.
Smart Asset, a financial company, says Indianapolis was the most affordable city to buy a home this year and last. However, Smart Asset says first-year costs have increased by more than 26% and are unlikely to fall in 2023.
According to Bankrate.com, the current mortgage rates in Indianapolis are nearly 7% on a 30-year fixed mortgage. That’s in line with the national average, which on Monday morning was 7.04%, Bankrate found.
In addition, the average home price in Indiana is roughly $230,000, which is below the national median, while average closing costs are just over $3,000, Smart Asset found.
Tiff Atkinson, a residential realtor in central Indiana, says a mortgage payment is not the only concern for her clients.
Atkinson says other expenses, such as closing costs, home inspections, property taxes, and insurance, can take a lot out of a buyer’s budget. In addition, she says home buyers need cash upfront to cover expenses and recommends home buyers work with a qualified lender to create a financial overview.
“They are going to look at the fee associated with buying a home. But, unfortunately, a lot of those fees buyers don’t understand. They don’t consider taxes, private mortgage insurance, or fees. They don’t know what it takes to purchase a home,” Atkinson said.
Smart Asset also ranked Philadelphia, Houston, Columbus, Ohio, and Jacksonville, Fla., among the more affordable cities for first-time homeowners.
California was king when it came to the cities with the least-affordable first-year home ownership costs. San Francisco, San Jose, Los Angeles, and San Diego took the top four spots on Smart Asset’s list, with home buyers in No. 1 San Francisco facing an average down payment of nearly $317,000, and an average closing cost of $7,938.