Think You Can’t Afford a West Coast Home? You Might Be Closer Than You Think!

When you hear the term “West Coast real estate,” you may automatically assume that it’s out of your budget. While many people automatically picture celebrity mansions in Los Angeles and expensive subdivisions in Washington, the truth of the matter is that the Pacific Coast real estate market has just as many affordable options as every other region of the United States.

For years, home prices in cities like San Francisco, Los Angeles, and Seattle have caused people to assume that the western US real estate market is out of their price range. While you may not be able to buy a house next door to your favorite actor in the Hollywood Hills, that doesn’t mean that you can’t afford to move to one of the most beautiful regions of our great nation.

Today, learn more about how you can make your dreams of buying a home on the West Coast a reality.

Expand Your Map: Affordability Is Hiding in Plain Sight

The idea that you can’t afford to move to the Western US is a misconception. While the average American can’t afford to buy a home in Hollywood or spend their days shopping on Rodeo Drive, the truth of the matter is that there are plenty of affordable options. However, you have to accept the fact that buying a home in the Western US does not mean living in Silicon Valley or moving into one of the dense, urban hubs in Oregon and Washington.

There are plenty of affordable options along the Pacific Coast, and even near it. In the same way that a house on the shores of the Atlantic Ocean costs more than one in Central North Carolina, homes that are on the coast of the Pacific are more expensive. Still, there are some options.

For instance, if you want to live in California, places like Fresno, Sacramento, Riverside, and Chico all offer lower entry points than some of the coastal cities that many people think of when they think of the Golden State. Similarly, you can find affordable housing in Washington by shopping in cities like Spokane and Tri-Cities, while Oregon has places like Salem and Medford that offer lower costs of living than some of the larger cities in the state.

It’s also important to remember that living in the Western United States doesn’t mean that you have to live on the Pacific Coast. There are plenty of cities in Arizona, Idaho, and Nevada that are only a day trip away from the West Coast. Places like Reno, Nevada, Phoenix, AZ, and Boise, Idaho, all offer affordable options that are close to the West Coast, making them ideal for people who are looking to make the move.

Busting the Down Payment Myth

“I can’t start looking for a home until I have a 20% down payment on hand.” Have you ever said those words about your plans to buy a home in the Western US? Many people assume that they have to have 20% of the purchase price on hand to cover the down payment, when that’s not always the case.

Yes, it’s true that many traditional 30-year mortgages require a 20% down payment. This is put in place to protect lenders from losing all of the money that they lend. However, there are multiple types of mortgages that you can apply for.

For instance, eligible veterans and members of the US Armed Forces are eligible for VA Loans, which don’t require any down payment at all. FHA loans have flexible credit requirements and only require a down payment of 3.5%. USDA loans are incredibly popular and also require 0% down. Homes that are in certain rural or urban areas are eligible for these loans.

What does all of that mean for you? It means that you could be eligible to purchase a $400,000 home with only $12,000 down instead of $80,000. That’s a game changer!

Flexibility is Your Secret Weapon

The idea of being a house doesn’t look like it did 50 years ago. If your idea of purchasing a home in the Western US involves a two-story home with four bedrooms and two and a half bathrooms, things are going to be difficult. Mortgage rates are high, inventory is low, and the market largely favors the sellers. However, single-family homes aren’t your only option. With this in mind, being flexible can be your shortest path toward home ownership.

For instance, condos and townhouses have lower barriers to entry than many single-family homes. While you will probably have to pay monthly HOA fees, the initial asking price on these homes is generally lower than traditional homes in the suburbs. If you have access to the money, you can also consider buying a duplex. On the surface, it may seem counterintuitive to purchase a place with two separate dwellings, but there’s an important fact to consider. You can live in one side of a duplex and rent out the other. Depending on the local rental market, you may be able to make enough to cover the mortgage.

It's also worth mentioning that you can consider investing in a home that needs some work. Depending on the location and just how much the property has deteriorated, you may be able to get a great deal on a property that needs some TLC. However, if you choose this route, be sure to consider any local zoning and coding ordinances, as you may not be allowed to do certain types of home remodeling yourself, as some local governments require licensed professionals to perform any type of home rehab.

Finally, consider looking for new constructions in emerging cities. Many land developers offer significant incentives for people who buy their properties in areas that aren’t yet in high demand. Sometimes you can get rate buydowns or closing cost assistance that make a home more affordable.

Be willing to think outside the box when home shopping. By being flexible about the kind of home that you’re going to live in, you may be able to find a better deal than you even imagined.

Meet With a Lender, Even If You Don’t Think You’re Ready

Some people assume that they shouldn’t talk to a mortgage lender until they’re ready to purchase a home. However, you can usually schedule free consultations with these professionals, which means you can get some information about what you need to do before you start viewing homes.

A good mortgage advisor can help you better understand just what you can afford. While they may talk about the amount that you can borrow, be sure to remember that you don’t have to spend the full amount. For instance, if you’re eligible for a $450,000 mortgage, you can borrow less if you find a home that fits in your budget.

You can also learn more about what types of loans are available to you. For instance, are you considering moving to Oregon? If so, you may be able to find a rural area that’s eligible for a USDA loan. By talking to someone who has access to data provided by the entities that set the requirements, you can open up more options for yourself.

Finally, a licensed mortgage lender can walk you through your current credit score, your financial status, and what steps you need to take to make homeownership a reality. If your credit score needs some work, your lender can help you with some tips for boosting it. This allows you to start taking steps in the right direction.

Avoiding the Rent Trap

Many people assume that they can’t afford to buy a home near the West Coast, so they start looking for rentals. However, renting may not save you as much money as you think. Sure, most types of mortgages require you to have some sort of down payment, but as we established earlier, the 20% myth is just that.

Some of the most popular cities along the Pacific Coast, like San Diego and San Jose, have average rents that run north of $2,000. Depending on your credit score, you may be able to get a mortgage with a monthly payment that’s lower than that. When you consider the possibility of annual rent increases, it makes buying a home an even better option.

Make Your Home Buying Dreams a Reality

If you’ve been dreaming of making a move to the Western United States but assumed that you can’t afford it, there’s good news. You may be closer to making your dream a reality than you thought. Happy house hunting!