Money Guy Show How Much Home Can You Really Afford in 2025?
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Jun 4, 2025 Navigating homebuying in 2025 is crucial as housing affordability hits historic lows. A deep dive into state income data reveals stark contrasts in home prices across the country. The discussion emphasizes flexible financial strategies and the importance of emergency funds for homeownership. Young potential buyers receive guidance on making informed decisions amidst changing life circumstances. Humor infuses the conversation as financial tips merge with playful exchanges, assuring that smart planning ultimately leads to greater financial security.
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Housing Affordability Gap
- Housing affordability requires about 160% of the median US income to buy a typical three-bedroom home.
- Median household income is $76,000 while recommended is $124,000, showing a daunting affordability gap.
Home Buying Rules To Follow
- Follow these home buying rules: stay at the location 5-7 years, down payment less than 20% is okay for first home.
- Ensure housing costs do not exceed 25% of your gross monthly income for financial soundness.
Home Affordability By Income
- With a 5% down payment and 6.5% mortgage, median $75,000 income buys a home under $250,000.
- Higher incomes roughly scale affordability: $100k buys $330k home; $125k buys $409k home.