Check if your home’s price is worth it.
So if your dream home can keep your insatiable thirsts of relocation, have you considered adding transportation costs to your total expenses? That’s the problem that the Center for Neighborhood Technology (CNT), an urban sustainability advocate, researched in their recent study. The group found out that “Under the traditional definition of housing affordability (30% or less of household income spent on housing), seven out of ten U.S. communities are considered “affordable” to the typical household. But in almost all metro regions of the country, when the definition of affordability includes both housing and transportation costs—at 45% of income—the number of communities affordable to households earning the area median income decreases significantly. Nationally, the number of affordable communities declines to 40 percent, resulting in a net loss of 48,000 neighborhoods with combined housing and transportation costs that stress the average family’s budget.”
I’ve had friends who were too delighted when they moved in their new houses only to find out that they’re spending more on transportation than their meals. CNT’s findings are relevant today as housing values are still at low levels that anyone who’s ready to purchase a property can have more options. What CNT wants you to do is to plan your desired house’s location carefully and estimate your net income that can be spent for driving to the store to get your basic necessities. Obviously, fuel costs play a major part in this issue.
The study further explains, “The failure to provide Americans with affordable transportation and compact neighborhoods that support pedestrians and cyclists as well as drivers, increases the financial pressure on families, resulting in unstable household budgets, lack of savings, and even foreclosure, and places communities across the country, particularly those with inadequate transportation options, at greater risk.”
Again, in real estate, always remember the cliché, “location, location, location.” Wouldn’t it be much nicer to get the house that you want and have less travel time to and from the workplace? Sounds an ideal property to me.