Study Finds Cities Where You Can Own a Home for $1K or Less a Month

Buy a home in one of these cities while you still can.

Owning a home is getting harder because of rising home prices across the nation. However, if you look hard enough, you can still find some major U.S. cities where housing is affordable.

To give you an idea of where you can own a home with a mortgage payment of less than $1,000 a month, GOBankingRates conducted a study of the 75 largest cities across the country. To calculate the mortgage payment, the study assumed a house bought for the current median list price with 20 percent down and the average mortgage rate for the state. The study also looked at the rate that housing prices are expected to change in the next year, according to Zillow.

Toledo, Ohio, took the top spot in the study with a monthly mortgage payment of just $382, making it one of the cheapest places to live. Memphis, Tenn., and Baltimore ranked second and third, respectively. Cleveland finished fourth because of its higher expected price increase, despite having the lowest median home value, median list price and monthly mortgage payment.

180328_GBR_U.S.Home20YearsAgo_1920x1080
©GOBankingRates

In this study, typically the lower the median list price, the better the city fared in the rankings. Four of the top five cities — Cleveland, Toledo, Memphis and Buffalo — have the lowest median list prices of any cities in the study — all were less than $80,000. No other cities have median list prices below $117,000. Baltimore is the one city of the top five with a higher median list price at $139,900, but it made up ground with a very low expected price increase for the next year of just 2.2 percent.

The highest projected price increase of the 20 cities in the study belongs to St. Louis, where prices are expected to rise by 5.6 percent. Pittsburgh isn’t too far behind, with prices there expected to rise 5 percent in the next 12 months. At the other end of the spectrum, the El Paso, Texas, one-year forecast anticipates only a 2.1 percent increase in prices, narrowly beating out Baltimore by 0.1 percentage points and Oklahoma City and Toledo by 0.2 percentage points.

Guess What? You’d Be Rich If Bought a Home in These Cities 20 Years Ago

Even though some of the expected increases in housing prices are smaller than others, all of the cities in the study expect home prices to go up at least 2 percent. So, it might not be long before a sub-$1,000 mortgage in these cities is history, too.

Here’s a complete look at the cities where you can own a home for less than $1,000 a month:

RankingCityMortgage RateMortgage payment/ Monthly1-year forecast, percent increase
1Toledo, Ohio4.29%$3822.3
2Memphis, Tenn.4.22%$4033.4
3Baltimore4.25%$6952.2
4Cleveland4.29%$3804.1
5Buffalo, N.Y.4.30%$4284.3
6El Paso, Texas4.22%$8062.1
7Oklahoma City4.30%$8872.3
8Milwaukee4.30%$5954.1
9Tulsa, Okla.4.30%$7893.2
10Wichita, Kan.4.33%$7463.7
11Indianapolis4.24%$7224
12Newark, N.J.4.24%$9202.9
13Cincinnati4.29%$8563.3
14Louisville, Ky.4.32%$9263.1
15Kansas City, Mo.4.29%$8793.4
16Columbus, Ohio4.29%$7864.3
17Philadelphia4.25%$9163.7
18St. Louis4.29%$6945.6
19Jacksonville, Fla.4.23%$9634.5
20Pittsburgh4.25%$9615

Before you buy a home, read these real estate tips no one tells you.

Methodology: GOBankingRates analyzed the 75 biggest cities in the U.S. and ranked the cities with a monthly mortgage payment of $1,000 or less, based on median housing prices from Zillow’s February 2018 data. Monthly mortgage payments were calculated assuming 20 percent down payment and the current average mortgage rate for the state. Monthly mortgage payments were scored and added to the 1-year forecast for home value score to determine in which cities housing soon will surpass $1,000.