Blog posted On September 29, 2020
Many renters are considering a home purchase lately, and you may know (or be) one of them. In addition to historically low mortgage rates, many companies have adopted work-from-home models, meaning their employees are commuting less or not at all. Zillow estimates nearly 1.92 million renting households could become homeowners this year because of the growing popularity of working remotely and the flexibility that goes with it.
When you don’t have to live close to work, you can open up your home search area, and even find a more affordable home. If you were previously commuting to a downtown urban area, you may have had to rent because you could not find any affordable homes to buy close to your workplace. When you get stuck in a cycle of long-term renting it becomes increasingly difficult to save for a down payment as rents rise, and you miss out on building valuable home equity. With telecommuting becoming more common, you may be able to afford a starter home farther away from your office.
Zillow economist Jeff Tucker explained, “proximity to work is just one of the factors people consider when choosing where to live. Other factors may keep them from moving including proximity to friends and family, cultural and natural amenities, and their kids’ schools.” With schools incorporating remote learning and many businesses and attractions adjusting attendance to comply with social distancing guidelines, these factors may become less important when choosing where to buy a home.
In many regions, the average monthly mortgage payment is less than the average monthly rent, and renters could easily afford a mortgage payment. If you’re curious, you can estimate your monthly mortgage payment based on the cost of your desired home, how much you plan to put down, and other financial factors. When you own your home, you also build home equity with every mortgage payment. If you ever need to access that equity, you can do so through a cash-out refinance.
If you’re thinking about buying a home farther away from your office, you may still want to stay within a reasonable commuting distance. Check with your employer about the latest work-from-home guidance, and make sure you could still commute to work when it’s time to return to the office. When you own your own home, you’ll also be responsible for repairs and maintenance. Make sure your budget allows you to comfortable pay your mortgage payment and save for repairs in the future.
When you’re ready to start looking for a new home, let us know. Your first step to buying your own a home is getting prequalified for a mortgage, and we would be happy to help with that.