This article takes a look at the 15 cities where you can buy a home for under $300,000. If you wish to skip our detailed analysis on 2024 housing optimism, you may go to 5 Cities Where You Can Buy a Home for Under 300k.
2024 Housing Optimism: Lower Rates, Improved Affordability
Glad tidings are on the way in 2024. With mortgage rates stepping down from a close 8% to 6.5%, home buyers can anticipate shifts in housing affordability, inventory dynamics, and sales trends. Morgan Stanley (NYSE:MS), the bearer of this good news, further expects improved incomes and an anticipated “uptick” in the number of house listings.
“We expect home prices to fall modestly as housing activity picks up versus 2023, with new home sales outpacing existing sales, but think the strong fundamentals of existing homeowners will prevent” sizable home price corrections.”
-Morgan Stanley (NYSE:MS) analysts
The investment banking company further notes that the second half of the year, in particular, will witness stronger housing activity. Moreover, new home sales are estimated to witness a 7.5% increase as compared to a 2.5% increase in existing home sales in the full course of the year. However, Morgan Stanley (NYSE:MS) isn’t the only one anticipating a positive outlook on the US housing market. Real estate companies such as Zillow Group, Inc. (NASDAQ:Z) and Redfin Corporation (NASDAQ:RDFN) present similar forecasts.
According to Redfin Corporation (NASDAQ:RDFN), a prominent real estate company in the US, housing affordability has already started to improve.
“Mortgage rates are under 7% for the first time in months, home price growth is slowing as lower rates prompt more people to list their homes, and overall inflation continues to cool. We’ll likely see a jump in home purchases in the new year as buyers take advantage of lower mortgage rates and more listings after the holidays”.
– Redfin Senior Economist Elijah de la Campa
Another real estate firm, Zillow Group, Inc. (NASDAQ:Z), expects improvements as well but isn’t as optimistic. The real estate giant states that the housing market will bring relief to home buyers by “just a bit”. Consequently, home buyers are increasingly shifting from larger metros to smaller towns, particularly in the Northeast. As per Zillow Group, Inc. (NASDAQ:Z), the most popular market of 2023 has been West Chester, Pennsylvania. The average home value of a West Chester home currently stands at $584,000. However, not everyone can manage to afford a home in this price range.
In this regard, Redfin conducted an analysis that reveals that a typical home buyer must earn $115,000 more to afford a median-priced home in the US. Since housing affordability has been at its worst this past year, real estate firms are now recommending that home buyers should think “outside of the box”. This means those individuals who are committed to buying a home should consider buying a condo or a townhouse instead of a house. Other options that they can avail is moving to a more affordable part of the country or a suburb. As such, the best city to buy a house is one that is affordable, offers adequate amenities, and is possibly close to family.
According to the Motley Fool, the median sale price of a home in the US is $431,000. The Zillow Home Value Index further reveals that Hawaii is the most expensive state to buy a home, whereas West Virginia is the least expensive state to buy a home. This affordability for an average home buyer varies by state. Many of the “hot homes” that sell quickly fall typically within the $300,000 price range. Fortunately, there are many cities in the US where you can find a home under $300,000.
The real question, however, is whether the average American can afford to buy a house worth $300,000 anyway. The Motley Fool states that considering there are expenses such as homeowner’s insurance, mortgage, and even property taxes, housing costs could be as much as $2,000 a month. This kind of expense is safe to take on for someone who makes more than $6,000 a month. For others who don’t make this much, it would be hard to meet this expense unless they make a down payment that’s larger than 20%, or have minimal expenses other than this housing one.
Considering you have enough to afford a home, let’s check out the top cities where you can buy a home for under $300,000.
Pixabay/Public Domain
Methodology
To compile the list of cities where you can buy a home for under $300k, we have used the National Association of REALTORS® list of Median Sales Prices of Existing Single-Family Homes for Metropolitan Areas. Next, we excluded out all areas with a median sales price above $300,000. Then, employing a consensus approach from various sources like Nasdaq, Smart Asset, Reddit, and Quora, we selected one city per state. This gave us a well-rounded list of cities where one can buy a home for under 300k.
Next, we ranked these places on their cost of living index and median home price to come up with a final Insider Monkey Source. Median home prices have been sourced from Redfin Corporation (NASDAQ:RDFN), while cost of living has been derived from Best Places. Places have been ranked in an ascending order from the lowest to the highest scores.
By the way, Insider Monkey is an investing website that tracks the movements of corporate insiders and hedge funds. By using a consensus approach, we identify the best stock picks of more than 900 hedge funds investing in US stocks. The top 10 consensus stock picks of hedge funds outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). Whether you are a beginner investor or a professional one looking for the best stocks to buy, you can benefit from the wisdom of hedge funds and corporate insiders.
Here are the cities where you can buy a home for under 300k:
15. Toledo, Ohio
Insider Monkey Score: 3
Median Home Price: $119,000
Cost of Living Index: 77.4
One of the best cities to live and retire in the US is Toledo, Ohio. Realtor has rated this Glass city as the number one real estate market of 2024. According to the report, homes in the city have a forecasted 2024 sales price change of 8.3%, and a forecasted 2024 home sales change of 14%. Redfin further states that houses in Toledo have witnessed an increase of 2.5% since 2022. Overall, it is a welcoming city celebrated for its rich cultural heritage, diverse community, and a range of family-friendly amenities.
14. Charleston, West Virginia
Insider Monkey Score: 6
Median Home Price: $150,000
Cost of Living Index: 81.3
With a median home sale price of $150,000 only, Charleston is another city where you can buy a home for under $300,000. According to Realtor, some of the best places to buy a home in Charleston are East End, West Side, and Downtown. Moreover, the real estate company notes that as of November 2023, the real estate market in the city is a buyers’ market, with more homes available for sale than the demand for homes. The city captivates residents with its scenic beauty, historic charm, and a friendly community atmosphere.
13. Bossier City, Louisiana
Insider Monkey Score: 7
Median Home Price: $185,000
Cost of Living Index: 76.6
The top reasons to buy a home in Bossier City are its affordability, sense of community, and amenities. The cost of living in this city is 23.4% lower than the national average. According to Redfin, home prices in Bossier City have been down by 20.8% since 2022. Hot homes in the area sell near the list price, whereas average homes sell 3% below the list price. The pace of life is slow here, and overall it is a family-friendly place to live in.
12. Cedar Rapids, Iowa
Insider Monkey Score: 9
Median Home Price: $176,000
Cost of Living Index: 81.8
One of the best cities where you can buy a home for under $300,000 is Cedar Rapids, Iowa. Livability has crowned the city as one of the best places to live in the US in 2023, owing to its scenic landscapes, excellent schools, outdoor adventures, and also its affordable costs of living. Redfin notes that the real estate market is very competitive, and home prices have been up 5.7% since 2022.
11. Abilene, Texas
Insider Monkey Score: 13
Median Home Price: $212,000
Cost of Living Index: 80.2
Owing to its affordable real estate market, low cost of living, and small-town charm, Abilene is a nice place to buy a home. On average, hot homes sell around the list price whereas the average home in Abilene sells for about 2% below the list price. The city boasts a diverse housing market, featuring both affordable properties and a range of amenities.
10. Memphis, Tennessee
Insider Monkey Score: 15
Median Home Price: $175,000
Cost of Living Index: 85.8
Another prime location to buy a home under $300,000 is Memphis, Tennessee. This city is widely known for its vibrant music scene, cultural heritage, and affordable housing market. Some of the best neighborhoods to live in Memphis include Downtown Memphis, Midtown, Harbor Town, and Cooper-Young.
9. Springfield, Missouri
Insider Monkey Score: 15
Median Home Price: $190,000
Cost of Living Index: 83.9
One of the best cities for buying a house in the US under $300,000 is Springfield, Missouri. Blessed with a thriving job market, good schools, top-quality healthcare, and plentiful amenities, Abilene presents an ideal setting for families and professionals alike. The city’s welcoming atmosphere, combined with its strong community spirit, creates a sense of belonging. Residents enjoy cultural events, parks, and a vibrant downtown, enhancing the overall quality of life.
8. Racine, Wisconsin
Insider Monkey Score: 16
Median Home Price: $180,000
Cost of Living Index: 86.2
In Racine, the cost of living is 13.8% lower than the national average. Moreover, the median home price is well below the national median. From affordable homes to Lake Michigan views, cultural attractions, and outdoor recreation, Racine can be a nice place to buy a home. Strong community ties, economic opportunities, and quality schools make it an appealing place.
7. Mobile, Alabama
Insider Monkey Score: 17
Median Home Price: $195,000
Cost of Living Index: 84.1
From historic homes in neighborhoods like Oakleigh to modern developments in West Mobile, Mobile is a nice city where you can buy a home for under $300,000. The real estate market in the city is competitive, and home prices have increased 5.7% since 2022. Situated on the Gulf Coast, the city captivates its residents with its historic charm, diverse culture, and Southern hospitality.
6. Rochester, New York
Insider Monkey Score: 17
Median Home Price: $161,000
Cost of Living Index: 88.6
One of the most affordable cities to buy a home in New York is Rochester. The median sale price of a home in the area is $161,000 only. Moreover, the cost of living is 11.4% lower than the national average. According to Redfin, an average home in the city sells 11% above list price, while hot homes sell 27% above list price.
Click to continue reading and see the 5 Cities Where You Can Buy a Home for Under 300k.
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Disclosure: none. 15 Cities Where You Can Buy a Home for Under 300k is originally published on Insider Monkey.