Providence Ranked Among Worst Cities in U.S. for 1st Time Home Buyers
GoLocalProv News Team
Providence Ranked Among Worst Cities in U.S. for 1st Time Home Buyers
According to a recent study completed by WalletHub, Providence is ranked as the 8th worst midsize city for first time home buyers.
Overall, Providence is ranked 267th out of 300 ranked cities.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTAs GoLocal reported Saturday, on the East Side of Providence, in particular, home values are skyrocketing, with houses that only a few years ago were worth $400,000 or $500,000 are now selling for a million dollars or more.
Houses go on the market and within a week there are more than a dozen offers meeting or exceeding the asking price — often by cash buyers.
Sally Lapides, President and CEO of Residential Properties, Ltd., says the combination of older people looking to downsize and Providence’s appeal as a city are fueling the boom. Buyers are more and more New York transplants or Boston commuters.
The issue is also helping to drive rents higher and higher.
“Buying a home for the first time is an exciting and important milestone for many Americans. Their purchases make up a sizable chunk of the market, too. In 2017, 38% of all U.S. single-family home purchases were made by first-time buyers,” said WalletHub.
Providence’s Rankings
- 244th Best– Real-Estate Tax Rate
- 206th Best– Cost of Living
- 48th Best – Rent-to-Price Ratio
- 82nd Best – Foreclosure Rate
- 175th Best – Property-Crime Rate
- 205th Best– Total Home-Energy Cost
The Rankings
Providence is ranked directly behind Corpus Christi, Texas and New Orleans, Louisiana, who rank 265th and 266th respectively.
Providence ranks ahead of Santa Ana, California and Houston, Texas, who rank 268th and 269th respectively.
Broken Arrow, Oklahoma is ranked as the best city for first time home buyers.
Berkeley, California is ranked as the worst city.
See the full rankings in the map below
The Method
To determine the most favorable housing markets for first-time home buyers, WalletHub compared a sample of 300 U.S. cities (varying in size) across three key dimensions: 1) Affordability, 2) Real-Estate Market and 3) Quality of Life.
They evaluated those dimensions using 27 relevant metrics. Each metric was graded on a 100-point scale, with a score of 100 representing the most favorable conditions for first-time home buyers.
Finally, they determined each city’s weighted average across all metrics to calculate its overall score and used the resulting scores to rank the sample. Each city was categorized according to the following population-size guidelines:
Large cities: More than 300,000 people
Midsize cities: 150,000 to 300,000 people
Small cities: Fewer than 150,000 people
Affordability – Total Points: 33.33
- Housing Affordability: Triple Weight (~14.29 Points)
- Average Cost of Homeowner’s Insurance*: Full Weight (~4.76 Points)
- Cost of Living: Full Weight (~4.76 Points)
- Cost per Square Foot: Full Weight (~4.76 Points)
- Real-Estate Tax Rate: Full Weight (~4.76 Points)
Real-Estate Market – Total Points: 33.33
- Rent-to-Price-Ratio: Double Weight (~4.44 Points)
- Housing-Market Health Index: Full Weight (~2.22 Points)
- Share of Homes Sold in One Year: Full Weight (~2.22 Points)
- Median Home-Price Appreciation: Double Weight (~4.44 Points)
- Foreclosure Rate: Full Weight (~2.22 Points)
- Share of Mortgage Holders with Negative Equity: Full Weight (~2.22 Points)
- Buy vs. Rent Breakeven Horizon: Full Weight (~2.22 Points)
- Share of Listings with Price Cuts: Full Weight (~2.22 Points)
- Share of Housing Units Built between 2010 and 2016: Full Weight (~2.22 Points)
- Building-Permit Activity: Full Weight (~2.22 Points)
- Mortgage Lenders per Capita: Full Weight (~2.22 Points)
- Real Estate Agents per Capita: Full Weight (~2.22 Points)
- Homeownership Rate for Millennials: Full Weight (~2.22 Points)
Quality of Life – Total Points: 33.33
- Recreation-Friendliness: Full Weight (~3.33 Points)
- Recession Recovery: Full Weight (~3.33 Points)
- Weather: Full Weight (~3.33 Points)
- Quality of School System*: Double Weight (~6.67 Points)
- Driver-Friendliness: Full Weight (~3.33 Points)
- Job Market: Full Weight (~3.33 Points)
- Total Home-Energy Cost: Full Weight (~3.33 Points)
- Violent-Crime Rate: Full Weight (~3.33 Points)
- Property-Crime Rate: Full Weight (~3.33 Points)
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