Homeownership may be something that's more within your grasp than you realize.

Here’s where you can buy a house for less

If you have been contemplating buying a new place over the past year or so, you know that affordable homes are pretty hard to find. Much of this is due to high demand and limited supply. It’s this less-than-ideal combination of factors – for budget-minded prospective buyers, at least – that has led to 58 months in a row of year-over-year price increases. In fact, according to the National Association of Realtors, a median-priced house in the United States currently sells for $232,200. That’s a 4% increase from one year ago.

So, does the pace of recent home sales and home price increases mean that buying a house for less is impossible? Not hardly. As the old saying goes, it all goes back to location, location, location.

Take Texas as an example. The second-most populated state in the country, the Lone Star State has gotten a bit more crowded of late, being within the top three for most inbound relocation destinations in America, based on 2015 data, according to the Texas Association of Realtors. At 65,500, the largest number of newly minted Texans moved from California, which is far and away the most expensive state in which to buy a house. In fact, in parts of the Golden State, the median is over $1 million.

Lower-priced properties found in Pasadena, TX

California transplants may be used to high asking prices. However, affordable homes of South Texas aren’t a dream, but a reality. For instance, in the city of Pasadena – a suburb of Houston – prospective buyers can expect to spend roughly 9.5% of their income on their mortgage, according to estimates done by Zillow, one of the internet’s most popular real estate and apartment listings websites. By way of comparison, in Palo Alto, California, home buyers there can anticipate committing more than three-quarters of their salary to paying down their mortgage.

How about at the Crossroads of America – Indiana, what many consider the heart of the Midwest. According to Zillow’s calculations, the mortgage burden of buyers in Indiana is 11%. But in the city of Fishers – which is positioned right in the middle of the Hoosier State – would-be buyers devote an estimated 8.5% of their take-home earnings to mortgage payments.

Meanwhile, in the nation’s capital, housing conditions are a bit more expensive than in the breadbasket of America. Nearly 18% of Washington, D.C., residents’ income goes toward mortgage expenses, according to Zillow’s analysis. Not too far away from the Beltway – 23 miles south, to be specific – is Waldorf, Maryland. There, prospective homeowners can plan on apportioning about 13% of their wages to paying down their mortgage debt.

Expect having to compromise

As with most things in life, there are trade-offs that come with living in a more affordable community. Svenja Gudell, Ph.D., chief economist at Zillow, made reference to this matter. For example, living in more affordable quarters might bring with it a lengthier travel time to and from work, or not have the same number shopping options, including grocery stores, retail chains, or small independent businesses.

To see where some of the more affordable places are to live in a city near you, check out Zillow’s study, which examined the mortgage burden for homeowners in nearly three dozen of the country’s largest metro areas.

Perhaps the best way to determine if homeownership is within your budget is by sitting down with a financial advisor or someone who specializes in residential real estate. They may provide some clarity on issues that you thought priced you out of the market. For example, even though a 20% down payment is recommended, it’s not required – a fact many Americans don’t realize. In a recent poll done by the National Association of Realtors, over 85% of respondents who didn’t own a house wrongly believed a down payment of 10% or more was a precondition to mortgage approval. In reality, over the past three years, the median down payment for first-time buyers has been 6%.

By doing a little extra homework, you can determine if buying a home can work for you.