Younger Home Buyers Are Willing to Relocate for the Right Price

For many home buyers, the search starts with a specific town, neighborhood or school district. But younger buyers are increasingly taking a different approach: figure out what they can comfortably afford first, then determine where that budget gives them the best opportunity.

A recent NewHomeSource survey of Gen Z buyers found that 63% would be willing to relocate to another city or state to afford a home, while only 19% said they would increase their housing budget.

That could be an important lesson for anyone trying to buy a home in today's market.

Sometimes Expanding Your Search Makes More Sense Than Expanding Your Budget

It's easy to get locked into a particular ZIP code when you're house hunting. Maybe it's the town where you grew up, where your friends live or simply the area you've always pictured yourself buying in.

But neighboring communities can have dramatically different home prices.

Here in South Jersey, expanding a search beyond one specific town can potentially open up entirely different price points and housing options. A buyer who isn't finding what they want in one community may discover that moving the search just a few towns away provides more square footage, a larger yard, a garage or other features without requiring them to significantly increase their monthly payment.

That's exactly the type of flexibility younger buyers appear increasingly willing to consider.

According to the survey, the most popular compromises Gen Z buyers would make to purchase a home were location-related:

• 35% would relocate to a less expensive area within their state

• 33% would consider a different neighborhood

• 28% would move to a more affordable state

Increasing their housing budget ranked much lower.

Start With the Payment, Not Just the Purchase Price

One of the biggest mistakes buyers can make is deciding what house they want before understanding what the financing looks like.

Instead, I prefer to start by answering a few important questions:

What monthly payment are you comfortable with?

How much cash do you realistically want to use for your down payment and closing costs?

What loan programs do you qualify for?

Once we know those numbers, we can determine a realistic purchase-price range and see what that budget buys in different areas.

For example, if your original search area isn't producing homes that fit both your needs and your budget, the answer doesn't necessarily have to be borrowing more money. Sometimes the better solution is expanding the map.

First-Time Buyers May Have More Options Than They Realize

This can be especially important for first-time home buyers.

You don't necessarily need a 20% down payment to purchase a home. Depending on your qualifications and the property, there may be conventional, FHA, VA, USDA and other financing options available. Some buyers may also qualify for down-payment or closing-cost assistance programs.

The right strategy depends on your income, credit, available funds, debts and the type and location of the property you're considering.

That's why getting properly pre-approved before seriously shopping for homes can make such a difference.

Instead of guessing what you can afford, you'll know your approximate price range and payment—and you can compare what that buying power looks like across multiple communities.

Don't Be Afraid to Widen the Map

You shouldn't buy a home in an area where you don't want to live simply because it's cheaper. Commute time, schools, taxes, family, lifestyle and long-term plans all matter.

But if you're struggling to find the right house within your budget, don't assume your only choices are to give up or spend more.

Expanding your search by 10, 15 or 20 miles could uncover opportunities you hadn't considered.

Gen Z buyers seem to understand that already: sometimes the smartest compromise isn't changing the house or stretching the budget.

It's changing the ZIP code.

If you're thinking about buying a home in South Jersey, Philadelphia or the surrounding areas, I can help you determine your buying power before you start searching.

We'll look at your numbers, discuss your payment comfort zone and determine which mortgage options may make the most sense for your situation.

Michael DeSanto | Mortgage MikeNMLS #1766709CrossCountry Mortgage

This information is for educational purposes only. Loan programs, rates, terms and eligibility requirements are subject to change and qualification.