Here Are the Most and Least Affordable Metro Areas to Buy a Home

Buying a home means more than just coming up with a down payment; it means making sure you can keep up with that property month after month. There are several factors, like property taxes, insurance, and maintenance, that factor into a home's affordability, so it's crucial to know what you're getting into.

Still, a home's price will generally be the single greatest factor in determining its affordability based on your earnings. And as you're probably aware, it's very possible that while your salary might buy you a comfortable space in one part of the country, it might easily fall short elsewhere.

NerdWallet recent compiled data on 173 distinct metro areas across the country, and here's where it landed on most affordable places to buy a home:

In these areas, the median annual household income goes a long way toward buying a home. But check out this second list, which shows where you'll have the hardest time buying property on an average income:

If you're searching for a new place to live, this data might help you narrow down your options. At the same time, be sure to keep these critical points in mind:

1. Housing costs shouldn't exceed 30% of take-home pay

Just because a certain area of the country is deemed generally affordable doesn't mean it's affordable for you. The last thing you want to do is take on too much house and risk losing that property several years down the line because you can't keep up with it. That's why, as a general rule, you'll need to make sure any home you buy doesn't eat up more than 30% of your monthly take-home pay. This means that if your paychecks put $6,000 in your pocket each month, your housing costs should be capped at $1,800.

Now there's some debate as to what that 30% threshold should include. Many financial experts agree that it should cover property taxes and homeowners' insurance as well, and some even go so far as to say that that figure should include standard maintenance. Personally, I favor the latter. Since certain maintenance items are predictable, you're safer building them into that 30% limit. This way, you have more flexibility for when unplanned repairs suddenly fall in your lap.

Not sure what to do? You can plug some numbers into this handy calculator to see how much house you can personally afford.

2. Aim to put down 20% on your home

You don't necessarily need to come up with a 20% down payment for the home you buy -- but that doesn't mean you shouldn't. Putting down 20% will help you avoid private mortgage insurance, or PMI, which gets tacked on as a premium in addition to your monthly mortgage payment. Simply put, PMI can make the cost of homeownership more burdensome, so it often pays to save money and wait a bit longer to buy.

3. Have emergency savings before buying

Though we all need emergency savings to protect us from life's expensive unknowns, having cash reserves is all the more crucial when you're buying a home. You never know what unexpected repairs you might run into early on or down the line, and without that cushion, you risk racking up debt the second your heating system goes or your roof springs a damaging leak. As a general rule, it's wise to have three to six months' worth of living expenses socked away in the bank, but if you're a new homebuyer and don't know what to expect, saving nine months of living expenses might buy you some protection and peace of mind.

Now that you know where to find the most affordable properties in the country, and what steps to take when buying, you'll be well-positioned to dive into homeownership responsibly. But remember, the above lists should be used as a starting point, not gospel. Cumberland, Maryland, might be the most affordable metro area to live in based on home prices, but if you can't find a job in that vicinity, there's no sense in moving there. You may be better off identifying places where your particular industry is thriving, and finding the least expensive one of the lot.

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