6 Best Big Cities for New Grads To Buy a Home for Under $250,000
In determining the best big cities for new grads to buy a home these days, Redfin and Glassdoor didn’t just consider average home prices.
The well-known websites considered numerous other factors within three categories: affordability, career opportunities, and urban quality of life. They then teased out 10 large U.S. cities with the best blends of high ratings. Of those 10, six have average starter home prices below $250,000.
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It’s all detailed in an analysis released in April by real estate site Redfin and job site Glassdoor. In the affordability category, the study factored in starter home inventory, ownership costs and related trends, as well as the rent-to-income ratio.
The career opportunity category evaluated average early-career incomes, economic diversity, job satisfaction, career opportunity satisfaction, job availability and post-pandemic trends in hiring. Finally, the quality-of-life category weighed ratings for work-life balance, walkability and transit.
The Redfin/Glassdoor list includes four cities with average starter home costs above $250,000: Washington, D.C. ($320,000), Boston ($460,000), San Diego ($615,000) and Austin ($276,600).
Here’s a look at the cities that ranked highest while coming in below $250,000, along with the average time needed to save for a down payment and other key data:
1. Omaha, Nebraska
Average annual early career income: $59,123
Price of a typical starter home: $195,000
Years to save for down payment: 3 years, 8 months
Monthly mortgage payment as a percent of income: 26%
Why it rose to the top of Redfin’s rankings: Large variety of jobs that new grads love, work-life balance
2. Dallas
Average annual early career income: $67,451
Price of a typical starter home: $240,000
Years to save for down payment: 4 years, 1 month
Monthly mortgage payment as a percent of income: 28%
Why it rose to the top of Redfin’s rankings: Reasonable rent costs, career growth potential
3. Chicago
Average annual early career income: $72,786
Price of a typical starter home: $202,000
Years to save for down payment: 3 years
Monthly mortgage payment as a percent of income: 21.9%
Why it rose to the top of Redfin’s rankings: Affordable starter homes, strong starting salaries, transit-friendly
4. Houston
Average annual early career income: $65,369
Price of a typical starter home: $215,000
Years to save for down payment: 3 years, 7 months
Monthly mortgage payment as a percent of income: 25.9%
Why it rose to the top of Redfin’s rankings: Large variety of jobs, strong bounce-back from pandemic, reasonable rent costs
5. St. Louis
Average annual early career income: $61,834
Price of a typical starter home: $150,000
Years to save for down payment: 2 years, 7 months
Monthly mortgage payment as a percent of income: 19.1%
Why it rose to the top of Redfin’s rankings: Large inventory of starter homes, a large variety of jobs, and work-life balance
6. Miami
Average annual early career income: $62,748
Price of a typical starter home: $210,000
Years to save for down payment: 3 years, 11 months
Monthly mortgage payment as a percent of income: 26.4%
Why it rose to the top of Redfin’s rankings: Career-growth potential, large variety of jobs, strong bounce-back from the pandemic
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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