After weighing the pros and cons of renting and buying, you’ve decided you’re ready to take the leap from renting into homeownership. However, the steady rise of interest rates is making it harder for you to qualify for a mortgage. You are not alone. CoStar researchers have found that rising mortgage rates are keeping millions of renters in their apartments for longer periods of time. You, and many others, are now faced with the task of saving more money for a larger down payment. How can you possibly do this while renting?
Save money on your rent by downsizing from a two-bedroom apartment to a one-bedroom apartment or from a luxury apartment community to a more modest, affordable complex. Selling what you don’t need while moving can also earn you some extra cash towards your eventual down payment in addition to your new rent savings.
By Getting a Roommate
Splitting your rent with a roommate is an efficient way cut your monthly costs in half while adding a significant boost to your down payment fund. While living with a roommate comes with its own set of challenges, you’ll be that much closer to attaining your homeownership goals in a shorter period of time when you opt to share your space.
By Creating a Budget
For the intuitive saver, tracking your budget may seem excessive but accounting for every dollar you make is critical to saving more of your income. Apps like Mint and LearnVest make budgeting your money effortless.
By Working on a Side Hustle
Increasing your earnings is a surefire way to fast-track your down payment savings. If you’re not up for a promotion or a raise at your day job, consider taking on freelance projects, driving for a ridesharing app, or working a part-time gig to make some extra cash on the side.
Saving for your down payment is a good way to prepare for the financial responsibilities that come with homeownership beforehand. Master these saving techniques while you’re renting and you’ll be well on your way to tackling property taxes, insurance fees, and overall maintenance allowances in no time.