What does your dream home look like? Is it a large house in the hills, or a flat in a high-rise building?


Housing is the largest expense that most people have. Whether you rent or own, your housing likely requires a much larger budget than the rest of your expenses.  Factors for housing cost include location, size,  amenities, and utilities. Currently, it’s recommended that you spend less than one-third of your monthly income on housing, as spending more can put you at risk for financial ruin. Choosing to purchase or rent a home that costs less than one third of your income is the best way to save money on housing costs. With a few adjustments to what you’re searching for in a place to live, you can find a dream home that works for your current situation.


The location of your home is a large factor of not only its price, but also the price of your home insurance. It’s also tied to other budget items like your car insurance and utility bill. By choosing to live an extra five to ten minutes away from a downtown or higher priced area, you could drastically reduce your housing expense.


Size is another major factor in determining the cost of your home. The count of bedrooms and bathrooms, combined with the square foot calculation of the space will determine price. Generally speaking, smaller homes may be priced for less, but have a higher cost per square foot. Larger sized homes almost always rent for a higher amount than comparable but smaller homes. By reducing the size of your home, you could save money on rent or mortgage, as well as heating and cooling costs.


Remember too that you have negotiation power. Not only can you negotiate the purchase price of a home, you may also be able to negotiate your rent. Many smaller landlords will allow some negotiation, unfortunately the same can’t be said for most corporate landlords. Set-price necessities like utilities and internet may not be negotiable, but usually you can shop around and find discounts for lower prices for a new vendor or maybe even your current one.


You can find a dream home that fits well within your budget by carefully considering your options. Understanding how your must-have traits in a home affect its value is the first step in starting your search. If you’d like to speak with a financial planner and get a professional opinion regarding your housing finances, call us today. We can schedule you for a free, no-obligation consultation.

Any opinions are those of Munn Gray & Associates, Inc. and not necessarily those of Raymond James.  Expressions of opinion are as of this date and are subject to change without notice. Any information provided in this blog is not a complete summary or statement of all available data necessary for making a financial decision and does not constitute a recommendation. Please consult with your financial advisor about your individual situation.