Brickell boasts renovated, LEED-certified and well-designed accommodations and world-class dining options. Read on to find out if Brickell, Miami is a fit.
Where is Brickell in Miami?
Brickell is a mixed residential-commercial slice of south Miami that stretches from the Miami River on its northern border to the Rickenbacker Causeway to Key Biscayne on its southern. Covering the 33129, 33130 and 33131 ZIP Codes, it’s the glitzy sendoff to any traveler on their way to the swaying palms of Crandon and Bill Bragg Cape parks.
Source: Rent.
Brickell overview
Brickell is and always has been central to the narrative of Miami as a playground for the rich and famous. In the early 20th century, it became home to South Florida’s “Millionaires Row” along Brickell Avenue.
The neighborhood eventually morphed into the state’s, and one of the nation’s, largest financial districts as high-rise apartment buildings, luxury hotels and offices took center stage. Today, developers are remaking Brickell into one of the state’s most exciting urban centers.
Studio average rent: $1,854
One-bedroom average rent: $4,401
Two-bedroom average rent: $4,893
Walk score: 88
Bike score: 75
Transit score: 89
Living in Brickell
Life in Brickell is generally regarded as loud, fast and fun. Geared decidedly toward employed young professionals, the neighborhood is known for its dining and nightlife scene set amid imposing skyscrapers. This has helped the area earn its nickname: “The Manhattan of the South.”
Demographics
A famously densely populated neighborhood, Brickell is also a relatively young area, with the median resident age ringing in at 34.6 years old and the average household containing no more than 2 people (family households make up only about 28 percent of all). Almost 80 percent of the crowd is not married and almost 90 percent is white or Hispanic.
By far, management, finance and the law are the most popularly represented professions in the area, with almost a third of all Brickell residents employed in just these positions.
Education
While there is Southside and three private elementary schools in the neighborhood, joined by the downtown campus of Florida International University, Brickell is not generally considered an educational hub. It is only a short car ride from The University of Miami and a selection of other private and faith-based schools, including Key Point Christian Academy and David Posnack Jewish Day School.
Safety
Neighborhood crime data is not available, but the crime index for the City of Miami as a whole is slightly higher than the national average. This comes with a few caveats: First, local crime maps reflect that much of the violent crime driving the city’s index occurs in neighborhoods to the south and west of Brickell. Second, crime in Miami-Dade County has been decreasing steadily year-over-year since 2006. Last year, the county reported 474.3 crimes per 100,000 citizens, a 25 percent decrease from five years prior. Generally speaking, Brickell is a safe part of the city.
Recreation
From shopping at Brickell City Centre to squeezing in a run at Brickell Key Park, it would be impossible to exhaust the recreational options available to you. Not only does the area boast some of the state’s most elegant dining and nightlife, but it’s close to the attractions of Miami Beach and Downtown Miami.
Transportation
Good public transportation is another reason to live in Brickell. The combination of Metrobus, Metrorail and Metromover can connect you to most parts of Miami. Simply acquaint yourself with the orange and green lines and off you go!
Business
Miami is one of the fastest-growing economic centers in the country. The absence of a state income tax and the geographical/historical proximity to Latin America has attracted business from every sector. Most of that action is taking place in Brickell, where job growth is outpacing the national average by almost 10 percent. For any burgeoning entrepreneur, consultant or money manager, Brickell is the place.
10 things to do in Brickell
From shopping to dining, running to relaxing, there is always something to do in Brickell. Simply decide what sort of leisure the day calls for and the odds are better than good that you will certainly enjoy the day here.
Part with your time and money in any of the luxurious shops of Brickell City Centre.
Squeeze in a workout at Brickell Key Park.
Grab a scenic drink with friends on the roofs of the W or the Conrad hotels.
Indulge multiple cravings at once at Casa Tua Cucina food hall.
Bridge generational gaps at the fun and unexpected Dolores But You Can Call Me Lolita lounge.
Head across the causeway to Crandon Park or Bill Bragg Cape Florida State Park to soak up the sun.
Take a stroll among the exhibits at the Pérez Art Museum.
Take in 20th-century opulence at the Viscaya Museum and Gardens.
Grab a cafecito at the iconic 24-hour Manolo and Rene Grill.
Catch a game or a show at American Airlines Arena.
Finding an apartment in Brickell
From food to fun to sun, no neighborhood captures both the history and the trajectory of Miami quite like Brickell. If you have the wiggle room in the budget and the energy to keep up with the crowd, then take a look at the rent prices in Brickell and see if you can take the plunge and call it home!
Rent prices are based on a rolling weighted average from Apartment Guide and Rent.’s multifamily rental property inventory as of June 2021. Our team uses a weighted average formula that more accurately represents price availability for each unit type and reduces the influence of seasonality on rent prices in specific markets.
The rent information included in this article is used for illustrative purposes only. The data contained herein do not constitute financial advice or a pricing guarantee for any apartment.
J.D. Candidate at the University of Miami Law School and Officer Candidate with the U.S. Marine Corps, Maxwell is dedicated to public service and a glutton for punishment. He’s also a glutton for pasta, avid home chef and Atlanta food enthusiast with not enough hours in the day or kitchen appliances on the shelf.
Chicago, IL – December 22, 2023 – Today, Zacks Equity Research discusses Federal Agricultural Mortgage AGM, LendingTree, Inc. TREE and Ocwen Financial OCN.
The Zacks Mortgage & Related Services industry continues to be impeded by the cooling market, fears of a looming recession and high mortgage rates. Purchase market tightening and declining refinancing volumes have cast a shadow over the industry’s speedy recovery. Housing price appreciation and affordability issues are other near-term headwinds.
Amid the ongoing economic headwinds, mortgage service providers will need to be more agile. To navigate the deterioration in the mortgage market and improve operational efficiencies, companies have resorted to headcount reduction and technology adoption. Also, diversified business operations and encouraging scenarios for the servicing segment will help industry players like Federal Agricultural Mortgage,LendingTree, Inc. and Ocwen Financial tide over choppy waters.
Industry Description
The Zacks Mortgage & Related Services industry comprises providers of mortgage-related loans, refinancing and other loan-servicing facilities. Numerous banks have been retreating from the mortgage business due to higher compliance and capital requirements. This allowed non-banks to increase their capacity to gain market share in the mortgage loans business, which accounts for the largest class of U.S. consumer debt.
Players in the industry are dependent on the interest rates determined by the Federal Reserve, as prevailing rates influence customers’ decisions to apply for mortgages. The companies also generate investment income from several financial assets, such as residential or commercial mortgage-backed securities and asset-backed securities. The firms make equity investments in mortgage-related entities, among others.
3 Mortgage & Related Services Industry Trends to Watch
High Mortgage Rates Keep Homebuyers on the Sidelines: The mortgage market dynamics have been challenged with the central bank having raised interest rates 11 times since March 2022, bringing it to a 22-year high of 5.25-5.50%. With this, the average rate on a 30-year mortgage climbed to 7.79% in late October to its highest level since late 2000.
Nevertheless, with expectations of rate cuts in the next year, mortgage rates have eased in recent weeks but remain high. High rates and low home inventory have resulted in higher borrowing costs for home loans and a spike in home prices. This is affecting mortgage demand, both purchase and refinance. The downward trend will negatively impact top-line growth for industry participants.
Industry Players to Resort to Cost Controls: The mortgage industry continues to be labor-intensive while servicing operations have been a significant cost driver. With high mortgage rates, homeowners will be less keen on home purchases and refinancings. This will likely compel companies to reduce excess headcount capacity to cut costs and navigate a gloomy market. Moreover, the industry has lagged other sectors in adopting automation technology. Amid a tight labor market, technology adoption can be a competitive moat by offering notable efficiency improvements and cost savings.
Servicing Segment to Offer Support: With significant declines in gain-on-sale margins and lower loan origination volume, industry players are likely to increase their reliance on the service segment for profitability. In a high-rate environment, the servicing segment offers a natural operational hedge to the origination business.
We expect slow prepayment speed to offer mortgage service rights (MSR) tailwinds. Hence, MSR investments are poised to deliver significant value appreciation and offer attractive unleveraged yields. Such MSR appreciation can drive the book value. With the U.S. single-family mortgage debt outstanding to reach $13.9 trillion by 2024 end, there are massive growth opportunities in the servicing portfolios.
Zacks Industry Rank Reflects Bleak Prospects
The Zacks Mortgage & Related Services industry, housed within the broader Zacks Finance sector, currently carries a Zacks Industry Rank #152, which places it in the bottom 40% of more than 250 Zacks industries.
The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates drab near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry’s positioning in the bottom 50% of the Zacks-ranked industries is a result of a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are losing confidence in this group’s earnings growth potential. The industry’s bottom-line estimate has declined 31.6% from that reported in December 2022.
Before we present a few stocks that you may want to consider for your portfolio, let’s look at the industry’s recent stock-market performance and valuation picture.
Industry Underperforms Sector and the S&P 500
The Zacks Mortgage & Related Services industry has underperformed the broader Zacks Finance sector and the S&P 500 composite over the past year.
The industry has declined 17.5% in this period against the broader sector’s growth of 16.2% and the S&P 500 composite’s rise of 25.4%.
Industry’s Current Valuation
On the basis of the price-to-book ratio (P/B), which is commonly used for valuing mortgage and related services companies, the industry currently trades at 5.32X compared with the S&P 500’s 6.05X.
Over the last five years, the industry has traded as high as 5.32X, as low as 0.78X and at the median of 1.72X.
As finance stocks typically have a lower P/B ratio, comparing mortgage and related services companies with the S&P 500 may not make sense to many investors. However, comparing the group’s P/B ratio with that of its broader sector ensures that the group is trading at a premium. The Zacks Finance sector’s trailing 12-month P/B of 3.36X for the same period is below the Zacks Mortgage & Related Services industry’s ratio.
3 Mortgage & Related Services Stocks to Watch
Federal Agricultural Mortgage: The company, also known as Farmer Mac, is a federally chartered corporation that combines private capital and public sponsorship to create a secondary market for various loans made to rural borrowers.
The company’s business lines include agriculture finance (consisting of farm and ranch, and corporate AgFinance), rural infrastructure finance (consisting of rural utilities and renewable energy) and treasury (funding and investment).
The company is expected to enjoy strong pipelines and volumes in the upcoming years, given the expected rise in agricultural productivity to meet the global demand, a growing U.S. agriculture mortgage market and a significant scope of improvement in renewable electricity capacity. Moreover, the expanding corporate AgFinance and renewable energy business lines carry higher margins than other operations.
The Zacks Consensus Estimate for AGM’s 2023 and 2024 earnings has been unchanged over the past month. The Zacks Rank #1 (Strong Buy) company’s earnings for the ongoing year and 2024 are expected to rise 33.5% and 7.8% year over year, respectively. Revenues for 2023 and 2024 are expected to grow 11.5% and 8.2%, respectively.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Ocwen Financial: The company is a preeminent non-bank mortgage servicer and originator that provides solutions through its primary brands — PHH Mortgage and Liberty Reverse Mortgage. Its balanced and diversified business model — diversified originations sources and servicing business — provides a competitive advantage against peers.
The company’s servicing financial performance is poised to benefit from high interest rates. Ocwen Financial has been driving expense reduction and taking right-sizing actions. Also, favorable demographics and home price appreciation are expected to drive continued growth in the reverse mortgage market.
The Zacks Consensus Estimate for OCN is pegged at $6.28 and $6.54 for 2023 and 2024 earnings. Earnings estimates have been unchanged over the past month. Also, for the ongoing and the next years, its revenues are expected to increase 10% and 4.5%, respectively. The company sports a Zacks Rank of 1 at present.
LendingTree: The parent company of LendingTree, LLC, is headquartered in Charlotte, NC, and has been operating solely in the United States since July 1998. Its online marketplace provides clients with product offerings from more than 600 partners.
LendingTree is committed to boosting revenues by diversifying its non-mortgage product offerings, particularly in the Consumer segment. With the launch of the LendingTree WinCard in partnership with Upgrade in February 2023, the company provided its first branded consumer credit offering. Over the past years, TREE has increased its services, such as credit cards and widened loan offerings to personal, auto, small business and student loans.
Also, LendingTree’s market-leading position and flexible business model, which provides more diversified solutions for a wider array of lenders, will enable its Home segment operations to navigate through the fluctuating macroeconomic situations and high-interest-rate environment.
The Zacks Consensus Estimate for TREE’s 2023 and 2024 earnings has been unrevised over the past month. For the ongoing year, earnings are expected to surge 99% year over year. For 2024, earnings are projected to grow 10.6% on 6.7% revenue growth. The company carries a Zacks Rank of 3 (Hold) at present.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The housing and rental markets in Orlando reflect the ever-changing landscape of living in this popular city known for its massive tourist attractions, many pristine lakes and an undeniably strong economy. The following insights, derived from Rent. and Redfin, provide a comprehensive view of the Orlando housing market for anyone interested in entering the scene.
Rental market in Orlando
The rental market in Orlando has seen significant fluctuations. As of 2023, the average rent for apartments in Orlando ranges between $1,669 and $2,060, with studio apartments averaging $1,717. The rates vary for one-bedroom and two-bedroom apartments, standing at $1,669 and $2,060, respectively. In nearby areas like Celebration and Kissimmee, the average rent for one-bedroom apartments is around $1,594 and $1,595.
Housing market in Orlando
The housing market in Orlando is notably active and competitive. Houses often receive multiple offers, with many selling for around 3% above the list price. The median sale price for homes in Orlando is approximately $327,500, marking a 14.9% increase from the previous year. This rapid pace indicates a strong demand, with homes selling in about 12 days on average.
Market impacts
Understanding the interplay between the rental and housing markets in Orlando is crucial for a comprehensive analysis of the city’s real estate dynamics. These markets influence each other in several ways.
Impacts of the rental market on the housing market
Investment attraction: A strong rental market in Orlando creates an attractive opportunity for real estate investors. High demand for rentals, coupled with rising rent prices, makes purchasing properties for rental purposes appealing. This can lead to increased competition in the housing market, potentially driving up home prices.
Housing supply and demand: As rental prices rise, some renters may consider purchasing homes, either to escape escalating rents or as an investment opportunity. This shift can increase demand in the housing market, particularly for more affordable homes, potentially leading to price increases.
Market sentiment: The strength of the rental market can be a barometer for the overall health of the real estate market. A strong rental market often indicates strong demand for housing in general, reflecting positively on the housing market.
Impacts of the housing market on the rental market
Homeownership affordability: As home prices rise, homeownership may become less affordable for a segment of the population. This can lead to increased demand for rental properties, as those priced out of buying may have no alternative but to rent.
Rental supply: When the housing market is booming, and home prices are high, investors might be more inclined to sell their properties rather than rent them out, potentially reducing the supply of rental homes and driving up rental prices.
Economic factors: The state of the housing market is often tied to broader economic conditions. For instance, a booming housing market might reflect a strong local economy, which can attract more people to Orlando, increasing demand for rental properties.
Neighborhood-specific dynamics
The interaction between the rental and housing markets can vary significantly across different neighborhoods in Orlando. Factors like proximity to major employment centers, schools, tourist attractions and transportation infrastructure can distinctly influence the supply and demand dynamics in both markets.
Tourist areas: In neighborhoods close to Orlando’s many tourist attractions, short-term rentals might be more prevalent, affecting both the availability and pricing of longer-term rentals and residential properties.
Suburban vs. urban areas: Suburban areas might see different trends compared to urban areas. For example, families might prefer suburban neighborhoods for homeownership, while urban areas might have a higher demand for rental properties due to a younger demographic or proximity to employment centers.
The rental and housing markets in Orlando are interdependent, with changes in one often impacting the other. Neighborhood-specific factors further complicate this relationship, making localized market analysis essential for understanding real estate trends in Orlando.
Cost of living considerations
Food costs: Grocery expenses in Orlando are slightly above the national average by 3.2%. The average monthly grocery spending in Florida ranges between $266 and $300.
Utility costs: Orlando’s utility costs are 4.7% below the national average. The city’s humid subtropical climate necessitates continuous air conditioning, especially in summer. The estimated monthly energy costs are around $151.74.
Transportation: Orlando’s transportation costs are 4.6% above the national average. The city is not very walkable, with a Walk Score of 35, necessitating reliance on cars. Public transportation options include the LYNX Bus Service, with affordable fares and passes.
Taxation
Florida has no state income tax, with a sales tax rate of 6%. In Orlando, an additional 0.5% is added for Orange County, bringing the combined sales tax rate to 6.5%.
Earning requirements
To comfortably afford the average rent in Orlando, an annual income of about $71,160 is suggested, based on the convention that rent should not exceed 30% of income. However, variations in rent across different neighborhoods offer flexibility for different income levels.
Orlando’s housing market
Orlando’s housing market is dynamic and competitive, reflecting the city’s appeal and growing economy. Orlando’s rental market, while varied, requires a significant income to comfortably afford the average rent prices.
Overall, Orlando continues to be an attractive location with a strong housing market, offering a range of options for residents with diverse financial capabilities. If you’re ready to settle down in a sweet place in Orlando, you’ve come to the right place.
In this episode of NerdWallet’s Smart Money Podcast, hosts Sean Pyles and Sara Rathner share the best money moves of 2023 as submitted by their fellow colleagues. Some of the highlights include saving aggressively to prepare for future expenses, getting rid of private mortgage insurance, automating finances for budgeting and planning, setting up 529 college savings plans for children, shopping around for the best mortgage rates, and understanding the difference between an emergency fund and a rainy day fund.
Check out this episode on your favorite podcast platform, including:
Episode transcript
This transcript was generated from podcast audio by an AI tool.
Sean Pyles:
If you’re a loyal fan of the show, it’s possible you stay until the very end of each episode and if you do, you always hear us say, “Until next time, turn to the Nerds.” Well, today, dear listener, we are turning the show over to the Nerds. We present the best money moves of 2023 by our fellow Nerds.
Amy Knight:
This year I learned how to explain the effect of compounding using a lovely seasonal analogy, snow. You think of your money like snow. When you spend it, it melts and runs away, but when you save it, any new snowfall sticks to the snow that’s already there.
Sean Pyles:
Welcome to NerdWallet’s Smart Money Podcast. I’m Sean Pyles.
Sara Rathner:
I’m Sara Rathner.
Sean Pyles:
This episode finishes off our Nerdy deep dive into the end of 2023. This is it, Sara, the finale of our last series of the year.
Sara Rathner:
The piece de resistance.
Sean Pyles:
Yes. We sent a notice out calling all Nerds, asking for the best things our colleagues did with their money in 2023, and I mean all Nerds, IT, HR, everybody, even the corner office, and today we’re going to share their money wins.
Sara Rathner:
I love this. Before we start, you and I are Nerds, too, right, Sean? Should we start with our money wins for 2023?
Sean Pyles:
I think we should. Sara, give us yours.
Sara Rathner:
Yeah. This sounds like a weird money win, but I have said, on the show before, one of the pieces of advice that I got when I was younger was to save as aggressively as you can for as long as you can because your life will get more complicated as you get older. Well, I have reached the point where my life is complicated and expensive, and I will say that because I had spent those years putting money away as best I could, I had money on hand to do the things that I needed to do this year.
There were some unexpected repairs to our house that we had to do. We ended up replacing our car because we had a baby, and that was probably one of the most expensive things I did in 2023 was pay all those hospital bills, and now I’m paying daycare bills, so this kid will cost me money until he’s 35 and then maybe he’ll be independent by then. We’ll know.
Sean Pyles:
They say you reap what you sow. You had been sowing savings for years and years, and now you are seeing the benefits of that, which is great.
Sara Rathner:
Yeah. What it has allowed us to do, and by us, I mean I say my husband and I, is say yes to the things we need and know that we have the money on hand. That’s really nice when something in your house breaks or there’s something that you want to do like travel or a night out with friends that’s going to cost a lot of money. We can say yes to the things that mean something to us because we spent so long just pocketing and putting money away, living as well below our means as we could. Now, I think we’re living at our means, which is nice.
Sean, what about you? What is your money win for 2023?
Sean Pyles:
Well, it’s a little Nerdy and a little in the weeds maybe, but I got rid of my private mortgage insurance on my house after going into war with the bank that owns my mortgage. It was not a fun process, but I came out the victor, and I’m so proud of myself for that because the bank that owns my mortgage is not very nice. That’s my money win for 2023.
Sara Rathner:
I’m surprised you had to go to war. Isn’t it just like, once you hit 20% equity, you have to refinance, or how does that work?
Sean Pyles:
Oh, yes, they barraged me with a mountain of paperwork and time delays and bureaucratic processes that I actually detailed in a Money Hot Takes episode of Smart Money. I think that you were out on maternity leave, Sara.
Sara Rathner:
Sean Pyles:
Will do. Okay. Great. Well, before we get into the Nerd’s best money moves of 2023, a reminder, dear listener, that we always love hearing from you. Leave us a voicemail or text the Nerd hotline at 901-730-6373, that’s 901-730 N-E-R-D, or email a voice memo to [email protected].
All right. Sara, are you ready to hear from our Nerdy colleagues about their best money moves of 2023?
Sara Rathner:
I am. Let’s see what they all learned this year and maybe we could take some of that advice and apply to our own finances.
Sean Pyles:
Yeah. I mean, that’s the idea, so let’s start with the boss. Tim Chen is the founder and CEO of NerdWallet, and he did an energy efficient move this year.
I switched from a Mercedes SUV to a Toyota Sienna. I’m getting twice the gas mileage. I’m using the cheap gas, and I’m paying about a 10th as much every time I service the car.
Sara Rathner:
Well, Sean, it is so true that you really save money on servicing when you don’t have a luxury car. Just getting a new battery or oil filter can be less expensive.
Sean Pyles:
Sara Rathner:
Yeah, new to me, and it’s a hybrid, so the mileage is pretty sweet.
Sean Pyles:
Nice. All right. Well, let’s hear from another Nerd. Skylar Damiano is an IT administrator here at NerdWallet.
Skylar Damiano:
My partner and I are accelerating our marriage to the end of this year because it’ll save us a ton of money in the long run via tax benefits. These are things that we just never thought about when we were single or, even in our case as queer people who never really thought about marriage beyond our domestic partnership, but I’ve also learned that I will never stop learning about the financial world around me. I can’t possibly know everything related to financial wellbeing, but the more I research and the more I practice good habits, the more likely I am to carry those good habits into the future.
One that stuck with me from last year is not spending beyond my means. I now wait until I have funds available before I make a purchase like a new smartphone or a new toy or a hobby that I want to get into. In this case, I want to become a DJ in the next year. I’m not spending any money on that equipment though until I for sure have enough to save on it, because if I have the option to not rely on credit, but instead use my credit card to my advantage via cashback, it’s far more rewarding for me down the line.
Sean Pyles:
Sara, waiting until you have enough money to actually purchase something you want is a timeless piece of financial advice, one of the most basic and most important.
Also, Skylar, I would love to hear a DJ set when you are up and running with your equipment.
Sara Rathner:
This is near and dear to my heart, but utilizing a credit card for points or cashback instead of carrying a balance, that is chef’s kiss. And Skylar wasn’t the only Nerd highlighting this idea. Here’s Tom Lehmann, an account executive for NerdWallet.
Tom Lehmann:
The best piece of financial advice I would have to say is live well below your means. What a lot of people do is, over the course of their career, they tend to make more money, and when that happens, they tend to buy more stuff. They buy a cooler car, bigger house, more clothes, everything. I call that the lifestyle tax. If you really want to take control of your finances, what you have to do is you have to increase the gap between how much you make and what your expenses are.
I think making more money will naturally happen to a lot of people as they progress in their career, so I think the real key is figuring out where you could cut costs and be minimalistic about everything in your life. Just getting rid of stuff and getting out of the habit of buying stupid stuff every time. Every time you buy one thing, you’ve got to get rid of two in your house. That’s a great way to start.
Sara Rathner:
Sean, I think a lot of us often take the opportunity at the end of the year or the start of a new one to get rid of stupid stuff. The harder part is Tom’s advice to get out of the habit of buying stupid stuff in the first place.
Sean Pyles:
Yeah, preaching to the choir, Sara, because I’m sure that I have some stupid stuff on the way to my front door as we speak. All right. Well, let’s hear now from Sally French. She’s a travel writer here, and she’s been on the show before. Here is her takeaway from 2023.
Sally French:
My biggest money lesson is to always ask if your travels go wrong. I was caught up in the United meltdown as well as I had a canceled Southwest flight, and even though I was able to get another flight, I was still delayed. While I wasn’t entitled to any compensation officially, I still asked the airline customer service and I asked nicely, and in both instances, I got either a flight credit or miles from the airline. Even if your travels are disrupted, even if you’re not entitled to compensation, it doesn’t hurt to ask, because like I did, I was able to get some money back.
Sara Rathner:
Love it. Always ask. What do you have to lose? All they can say is no and you’re on your way, or not and you’re stuck at the airport indefinitely, but you could still ask.
Sean Pyles:
Yeah. You’re hopefully on your way unless your flight is canceled twice, but yes, it’s always worth asking. Next up, we have Kevin Berry. He leads multimedia content here at NerdWallet and happens to be my direct boss. You’ve heard his name in the credits of this show as a fact-checker and editor.
Kevin Berry:
I think my big money takeaway from 2023 is that automation of your money can be really, really valuable and super helpful when it comes to budgeting and planning. I spend, whatever, an hour every January looking at everything and the money coming into my checking account, and I had set up all these automated like, “Send this money here. Send this money to an investment account. Send this money to a savings account,” and just set it and forgot about it and let it do its thing this year, and then that has really come back to help me.
For example, the property tax bill showed up, and I was like, “Whoa, it went up, it’s thousands and thousands of dollars,” but then I went to my account that I’d set up for automated savings for property taxes because I knew this bill was coming, right? Kevin in January knew Kevin in November had to pay this bill, and lo and behold, the math held up and there was the right amount of money there, and that just took a lot of stress out of it. Yeah, I think my money lesson is invest in automation for things that you know you’re going to need to pay for or want to pay for, even like a vacation. That’s just been a real stress reliever and time saver on my end in 2023.
Sara Rathner:
Oh, man, Sean, automation can absolutely save your sanity. I have quite a few automated contributions in my own finances. A big one, two big ones, is I automate contributions for my largest expenses, which are my mortgage and daycare, and that comes out of my checking account into a joint savings account. My husband also contributes, and then the money is whisked away by an automatic clearing house once a month or once every other week, depending on the bill.
Sean Pyles:
Lovely. You just need to make sure that the money is actually automatically going into that checking account so it can then be paid elsewhere.
Sara Rathner:
Then there’s automation, obviously, into my retirement account, my 401(k) that I set up at work. If you work for a place where you have to opt into the 401(k) when you first start your job, do it. Because the longer you wait to get that started, the less money you’re able to save up, and you might even be missing out on employer match. If you’re starting a new job or if you have been in your job for a while, but you just haven’t bothered to set up your retirement accounts yet through your employer, maybe make this the year you do that.
Sean Pyles:
Absolutely. Well, I think I’m going to take a page out of Kevin’s book and set up automated deposits into an account for my car’s annual registration, because every year, June Sean curses every-other-month-of-the-year Sean for not saving up for that in advance. Okay. Our next piece of advice is from Hannah Cho. She’s our Nerdy vice president of content.
Hanah Cho:
This year, I’m really proud of finally sending up 529 college saving plans for my two kids. I have three kids, and I have one set up for my oldest, and I finally got around to setting up two for my youngest. I’m really trying to lean into taking advantage of time. They’re still very young where I still have probably 10 to 12 years before they head off to college.
Sean Pyles:
Yes. All of those years of investing and compounding will work wonders. Sara, I know you just had your baby like five minutes ago, but have you set up a 529?
Sara Rathner:
I have, so by the time my kid is 18, he’ll either be well on his way to college or he’ll be fighting in the climate war of 2041.
Sean Pyles:
That’s grim, but probably not inaccurate.
Sara Rathner:
It’s grim, but I want to set him up for a realistic life.
Sean Pyles:
Right. He’ll be able to buy plenty of munitions on the battlefield.
Sara Rathner:
Sean Pyles:
Well, Sara, you weren’t the only Nerd to procreate this year. Adam Smith did as well, and he’s all over the 529 planning.
Adam Smith:
In 2023, my wife and I actually had twin boys, and the first thing that came up once I heard that was knowing that I’ve got to pay for potentially two college educations at the same time, so another thing that crossed my mind was what if one of them goes to college and the other one doesn’t, or what if neither of them go to college? What’s the best way to approach this? We actually found that there’s a change to the 529 plan, which is how a lot of people save for their child’s college education, and so should your child or if one of our twins or both of them decide not to go to college in the future, you can actually roll the 529 plan into a Roth IRA, and the beneficiary of the 529 plan now becomes the owner of that Roth IRA. Traditional Roth IRA rules apply when transferring ownership, but, that being said, it’s a great savings vehicle for college planning or setting up a nice little nest egg for my twins in the future.
Sean Pyles:
You know what, Sara? I love that Adam knows that there are options for his kids, college or no college.
Sara Rathner:
Yes, and this is a huge way to get your kids started on their financial lives regardless of what they do after high school.
Sean Pyles:
All right. Up next is Alison McCoy, VP of brand marketing at NerdWallet.
Alison McCoy:
My husband and I, we’ve officially begun our home-buying process, and one of the best things we did this year was shop around for the best mortgage. I was pretty surprised at the options out there even in this high interest rate environment and feel really confident that we found the right option for us, that makes sure we’re not leaving any money on the table.
Sara Rathner:
Yes, always shop around for just about anything, but especially mortgage rates especially now.
Sean Pyles:
As Alison knows, we have a lot of mortgage and home buying information all over NerdWallet. We have a whole team devoted to that subject matter, and Abby Badach Doyle is a member of that team. Here’s her best money move of 2023.
Abby Badach Doyle:
This year, I learned the difference between an emergency fund and a rainy day fund. People use those terms interchangeably. I know I sure did, so I never really thought about it, but they’re actually two pretty different things. An emergency fund is for big major surprise expenses like major unexpected car repairs, new carburetor, and a rainy day fund is to help you pay for those things that aren’t necessarily emergencies, but are still outside of the scope of your typical monthly budget, like “Wow, the car is dirty after this camping trip. Can we please pay someone to do a deep clean and a full detail?”
Anyway, in our savings account, we’ve always used named sub-accounts for goals like holiday shopping and travel, but then we had this amorphous blob of money that I always felt so weird and guilty tapping into. Even though we’re disciplined savers and there was always enough there, it always just felt weird. This year, I split the blob into separate rainy day and emergency fund accounts, and that took away all of the stress and weirdness. Mentally, it was so helpful to not feel bad about spending money that I knew that we needed to spend on stuff that we knew was coming and to know that we’re still on track with our emergency savings for the bigger, unexpected stuff.
If you haven’t tried naming sub-accounts yet, I highly recommend it, and review the names often to make sure that they’re still working for you. If you need to set a savings goal for your emergency fund, try using an online calculator. NerdWallet, of course, has a great one. And then name that and separate it from your rainy day fund and from the rest of your other savings goals. That might be a small thing, but it was super helpful to me this year, and I hope that it helps you, too.
Sean Pyles:
Sara Rathner:
Sean Pyles:
Sara Rathner:
Sean Pyles:
I feel like we should do a chest bump or a high five after that. Anyway, Sara, do you have an amorphous blob of money that you feel weird and guilty tapping into?
Sara Rathner:
Always with the guilt, but the blob of money is divided into several smaller sub-blobs in the form of a few accounts with different purposes, and that helps me stay organized when it comes to deciding which accounts to use when I need to fund something.
Sean Pyles:
Love it. I mean, it’s no secret to devoted Smart Money listeners that I have many sub-blob accounts that I use on a daily basis. Also, nice call out to our NerdWallet calculators. Okay. On to our final Nerdy piece of advice.
Sara Rathner:
Already? That was fast.
Sean Pyles:
I know. Well, the good news is, Sara, that we’re always here, all of us, all of us Nerds, and we are here for you and our listeners. Our final guest is Amy Knight. She is a spokesperson for NerdWallet UK, and she has a money lesson to share about compound interest and the beauty of snowfall.
Amy Knight:
I have a money lesson to share about compound interest. This year, I learned how to explain the effect of compounding using a lovely seasonal analogy, snow. I think this is a great way to think about saving, and it can be helpful when you’re trying to start taking a longer-term view of your finances.
The lesson is this. You think of your money like snow. When you spend it, it melts and runs away, but when you save it, any new snowfall sticks to the snow that’s already there. New snowfall is your wages, maybe a bonus or holiday gift, an inheritance, maybe you sold an asset. Importantly, snow falls as interest. If you’re not actively saving, new snowfall is not going to stick. It’s going to melt and run straight out of your account.
We see in real life that fresh snow sticks a lot more when there’s already snow on the ground. I’m going to give a shoutout here to my friend Kim in Wisconsin who will soon be shoveling her driveway every day. You start with a thin layer, and as more snow falls, it builds up, and this is very like compounding. Gradually, your snow pile of savings compounds, and the bigger it gets, the more interest sticks to your money. As you watch it grow, you may be less tempted to melt the whole lot on an impulse purchase.
I’d love to know what you think of this analogy, Sean? This winter, if you are able to leave just a little savings in your account after the holidays, think of it like leaving a thin layer of snow on the ground ready for 2024’s snowfall to stick to. Don’t forget the Nerds can help you understand more about saving and investing. To discover how different financial products could work for you, just head to the personal finance section on NerdWallet.com.
Sara Rathner:
Well, that was lovely and spoken like a true spokesperson.
Sean Pyles:
Gotta love the plug. She does that for a living. I also really like this idea of snow as a metaphor for saving and compounding. Not only is it accurate, it’s also very soothing.
Sara Rathner:
Well, I’m closing my eyes here in Virginia, waiting for maybe a snowfall this year that, within minutes, will turn all black and sooty, if we even get snow at all because last year we didn’t.
Sean Pyles:
I’m hoping we get at least a little bit here in the Pacific Northwest. And also, shoutout to Kim in Wisconsin.
All right, and that’s a wrap on our year-end special series for 2023, but never fear, we’ll be back next year. In the meantime, if you have a money question of your own, turn to the Nerds and call or text us your questions at 901-730-6373. That’s 901-730 N-E-R-D. You can also email us at [email protected]. Visit nerdwallet.com/podcast for more info on this episode, and remember to follow, rate and review us wherever you’re getting this podcast.
Sara Rathner:
This episode was produced by Tess Vigeland. Sean helps with editing. Kaely Monahan mixed our audio, and a big thank you to NerdWallet editors for all of their help.
Sean Pyles:
Here’s our brief disclaimer. We are not financial or investment advisors. This Nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances.
Sara Rathner:
With that said, until next time, turn to the Nerds, and Happy New Year.
Austin has a reputation as a global live music capital, a hipster haven and an outdoor enthusiast’s dream come true. Best of all? The cost of living in Austin is still more affordable than most bustling metropolises.
Even though locals complain about skyrocketing prices, the overall cost of living in the Lone Star State capital is just a fraction higher — only 1.2 percent — compared to other cities.
The most expensive part of living in Austin is housing, but even that’s offset by savings on gas prices, transportation, utilities and food. It would be negligent not to mention the quality of life — which is impossible to put a price tag on — that Austinites will proudly tell you is one of the highest around.
Year-over-year cost of living changes in Austin
We’ll deep dive into the data and highlight the cost of living and rent in Austin, but first, here’s a snapshot of year-over-year changes in the cost of living in Austin.
Groceries: -0.22%
Housing: +1.82%
Utilities: no change
Transportation expenses: -3.57%
Healthcare: -3.41%
Miscellaneous expenses: -2.23%
As you can see, in most categories, the cost of living has actually decreased. However, the average housing costs increased by almost 2 percent.
Now that we’ve highlighted annual changes from the past year, let’s look into each category so you can put together a living calculator and determine if this is one of the best places for you to call home.
Average rent is cheaper than San Francisco
How you feel about the housing market in Austin depends on where you’re coming from. New York City and San Francisco transplants will find property value refreshingly affordable, while those moving to Austin from smaller cities may find average rent surprisingly expensive.
Average rents for Austin apartments have increased compared to last year. A one-bedroom apartment in Downtown Austin is up 45 percent and costs an average of $1,523 per month. Of course, the cost of housing varies pretty dramatically depending on what part of Austin you’re in.
Average apartment rent in Austin
When you compare the cost of rent for a one-bedroom in Austin to a one-bedroom in San Francisco, you’ll realize the price difference. A one-bedroom in San Fran averages $3,368 a month.
Minutes from Downtown and a short walk to all things boutique and hip, Bouldin Creek rents average around $3,037 per month. Triangle Slate, Central Austin and Barton Hills have all seen price hikes for one-bedroom apartments and range from $2,146 to $2,588. These are some of the most popular neighborhoods and you’ll pay a higher price to live here.
More typical, however, are the family-friendly neighborhoods of Clarksville and Brentwood, with average rents ranging from $1,825 to $1,839, respectively.
For bargain hunters, it’s possible to find even better deals on rent, like $950 in Crestview or $1,000 a month for a one-bedroom in North Loop.
Average cost of homeownership in Austin
Homebuyers will probably not be surprised to find that the real estate market is hot and housing prices are competitive. Housing costs in Austin are 11.8 percent higher than the national average. Data shows the average cost of a home in the best neighborhoods of Austin is $565,000.
Of course, home prices vary, but one thing is certain — most are going well above the asking price. In fact, according to Redfin, homes in Austin are selling at the biggest premium in the country, seven percent above asking prices and are on the market for an average of 38 days.
Cost of food in Austin
Food costs vary from Houston to Dallas to Austin, but one thing is for sure — foodies have much to celebrate in Austin. From celebrity chefs to taco trucks, good eats await around every corner, at every price point.
Budget diners can enjoy Taco Tuesdays at Quality Seafood with $2 beers and $2 seafood tacos. On the higher end, Sunday brunchers can savor authentic Mexican fare at Fonda San Miguel for around $39 per person.
Groceries in Austin cost about 8 percent below the national average. A dozen eggs will set you back $1.56, a half-gallon of milk is $1.98 and everyone’s favorite morning beverage, coffee, will cost $4.04.
Overall, Austinites will pay less for groceries compared to other cities. In fact, the cost of food decreased by 0.22 percent since last year in the same location, according to coli.org data.
Utility costs in Austin
Austinites are an outdoorsy bunch, whether it’s kicking back at a music festival or taking care of business from a coffee shop patio. But don’t be fooled by the sometimes mild climate — this is a city that loves its air conditioning and is willing to pay for it.
Luckily, utilities are about 5 percent below the national average, totaling around $155.01 a month for your total energy bill.
When you calculate the average rent and cost of living in Austin, don’t forget to include the cost of utilities. Your average rent budget should account for the cost of electricity, water, sewage, gas and internet.
Transportation costs in Austin
First, the good news: Transportation costs in Austin are about 14 percent lower than the national average. Now, the bad news: There’s a reason Austinites love to complain about the traffic.
With only two east-west interstates and no ring road around the metro, traffic in town is nothing to scoff at. Austin is often ranked in the top 10 worst commutes in the country, with average commute times around 40 minutes. One of the keys to happiness for life in this city is minimizing the time you spend on freeways.
Public transportation in Austin
The city has a fair transit score of 44 — primarily because of urban sprawl. Settling down in an area with access to public transportation can relieve some of the headaches of your daily commute. CapMetro is the local transit system, and it includes bus routes, light rail and university and airport shuttle buses.
Overall, CapMetro is an affordable option for getting around — if you’re not in a hurry. Kids under 18 ride free on all services, and the standard single-ride bus fare is $1.25. You can expect to pay $41.25 for a 31-day pass.
Even with the sweltering heat and sprawl, Austin’s overall walk score is 62. And with a bike score of 70, cyclists find Austin generally bike-friendly. However, the central parts of town are the most bikeable parts of the city and the most walkable: Downtown, Cedar Park, Central East Austin, all University of Texas areas, Hyde Park and Old West Austin. CapMetro buses and trains have bicycle racks that make it easy for folks to do a hybrid bike commute, even if they live in the suburbs.
Whether you’re using public transit to and from schools or your university or your job, renters can rely on public transit to get them around. Just don’t forget to account for this with your annual salary.
Driving costs in Austin
There are a handful of toll roads around Austin, which can significantly reduce driving times from the suburbs. The rates are confusing and vary dramatically, ranging from $0.62 to $2.79. For savings and convenience, a TxTag reduces tolls by about 25 percent and deducts from a prepaid account.
Driving is most people’s primary mode of getting around town, but it comes at a premium. Parking costs an average of $219 per month, and gasoline — while lower than the national average — still costs around $3.85 a gallon. Tire balancing costs about 10 percent less than the national average of about $43.10.
Healthcare costs in Austin
Always a hot-button issue, healthcare costs are one of those areas where your mileage may vary. Taking that into consideration, there are some general benchmarks that can give you an idea of overall healthcare costs in Austin.
A visit to an Austin dentist for a routine examination typically costs around $119, and a regular checkup with a family doctor will run you about $111.
If you’re paying out of pocket, expect to shell out around $473 for a prescription, which is right in line with the national average. But if an Ibuprofen is all you need, then you’re in luck — at $8.79 for a bottle, it’s a bargain.
Goods and services costs in Austin
Having covered the bare necessities, that leaves a world of non-essential — but not unimportant — spending to consider. Austin ranks well in this area, with goods and services just barely more than the national average.
Austin is a film buff’s dream — full of movie theaters showing everything from obscure classics to mega-blockbusters. An average movie ticket costs just $10.53, and if you’re at a BYOB backyard event, a six-pack of beer will set you back $10.12.
Staying fit and looking sharp is easy in Austin. Yoga studios dot the city, and the typical class fee is around $20, although monthly memberships will cut that fee in half or less.
Haircuts cost on average $28, and a visit to a beauty salon is usually around $50.
Even if you’re on a tight budget, you’ll find a ton of free entertainment and opportunities for physical activity in the many parks around town.
Taxes in Austin
For anyone new to the great state of Texas, the big bonus is that there’s no state income tax, which everyone loves come tax time. Effectively, tax rates are non-existent.
State sales tax is 6.25 percent which makes up most of the 8.25 percent sales tax in Austin. So, if you drop $1,000 on a flat-screen TV, you’ll spend an extra $82.50 in tax.
However, there are four sales tax holidays each year in Austin, each offering breaks in different categories. April is for emergency preparation supplies, Memorial Day weekend is for EnergyStar appliances and water-efficient products and August is for back-to-school items. These are perfect opportunities to buy big-ticket items at considerable savings.
How much do you need to earn to live in Austin?
For overall financial stability and well-being, finance experts recommend that your rent should not exceed 30 percent of your budget. For an average $1,599 apartment, that means that your average salary is $63,960.
According to the U.S. Census Bureau data, the average Austin income is $71,576. Use our rent calculator to see for yourself how you might need to tweak your budget to afford the average rent for an apartment in Austin.
Living in Austin
Most locals will tell you that life in the ATX lives up to the hype. “Come for the mild weather, stay for the Tex-Mex,” they say. OK, maybe nobody says that, but they definitely should.
Austin offers all the amenities of a big city — a booming economy, excellent food and world-class entertainment — while maintaining a famously small-town feel. From professional opportunities at tech companies to natural beauty, there’s always something more to explore in Texas’ capital city.
Regardless of your budget or tastes, there’s a home in Austin waiting for you. Check out the apartments for rent in Austin and find your landing spot today.
Cost of Living Index comes from coli.org.
The rent information included in this summary is based on a calculation of multifamily rental property inventory on Rent. as of March 2022. Rent prices are for illustrative purposes only. This information does not constitute a pricing guarantee or financial advice related to the rental market.
State officials have revived a popular grant program to help lower-income California homeowners build accessory dwelling units by covering some of the upfront costs. But funding is limited, so demand for aid may soon outstrip the supply of dollars.
The California Housing Finance Agency’s ADU Grant Program offers up to $40,000 to qualified homeowners to cover pre-construction costs of an ADU, including planning and permit fees for the structure. The program exhausted its initial $100 million months ago, causing the agency to stop taking applications; now, $25 million more is available for homeowners seeking help.
Obtaining a grant is not as simple as filling out a form online, however. For starters, applicants have to meet the program’s new income limits. Household income must be less than 80% of the area median income, which translates in Los Angeles County to $84,160. That’s down from 150% of the area median income in the initial round of grants.
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Applicants also need to work through a state-approved lender or “special financing participant” because the grants aren’t paid to homeowners — they’re paid to lenders. The CalHFA website lists 18 participating lenders as well as 10 governmental or nonprofit agencies, including Neighborhood Housing Services of Los Angeles County, which specializes in affordable housing.
Typically, homeowners must obtain a construction loan for an ADU from a participating lender before seeking an ADU grant. The loan will cover the costs that the grants will reimburse, including architectural designs, permits, soil tests, impact fees, property surveys, energy reports and utility hookups, the agency says. These expenses can make up a sizable portion of the cost of a new ADU, especially one built by converting a garage or other existing structure.
If you haven’t started work on an ADU yet, let alone obtained a loan, you can still get in line for a state grant. Neighborhood Housing Services, which provides construction loans for ADUs, says it will try to reserve a potential grant for anyone who emails it two pieces of information: a current mortgage statement and one month’s worth of pay stubs or other proof of income. The information, which should be sent to [email protected], should also include the person’s legal name, address and Social Security number.
A homeowner who meets the income limits but can build an ADU without a loan can still apply for a grant through NHSLA. But the agency’s construction team would have to manage the project and the grant funds, said Iris Cruz of Neighborhood Housing Services.
Grant applicants will have to sign and submit an affidavit to CalHFA attesting to several things about themselves and their plans, including that they are a U.S. citizen or legal resident; they own and have their primary residence on the property where the ADU is being built; they will use the ADU for permanent housing or long-term rentals; and the ADU will conform to local building and zoning codes. If any of those statements prove to be false, the applicant could face a prison term and a fine of up to $10,000.
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The lender, meanwhile, will have to attest that the grant applicant meets the program’s income limits.
As Florida’s insurance crisis makes hurricane hardening more important than ever, consumer advocates have pressed to reign in a popular — but controversial — loan program that allows homeowners to pay for new roofs or impact windows through their property tax bills.
Some counties and tax collectors across the state have pushed for clearer disclosures for a program that has generated hundreds of complaints from people who say they were misled on costs or didn’t understand that the loan amounts to a long-term tax lien on their home.
Now, one agency that bankrolls construction projects for the Property Assessed Clean Energy program, known commonly as PACE, is pushing back — arguing that individual counties have no legal right to force it to follow additional rules or even decide where it can operate.
The fight has led to a high-stakes lawsuit that includes nearly half the counties in the state, several of which have blasted the continued operations of a single quasi-governmental agency in Northeast Florida as “an immediate danger to the health, safety or welfare” of residents. Tax collectors from Alachua County to Palm Beach have complained in emails and court records that the Florida PACE Funding Agency’s statewide expansion is “running roughshod” over local government rights. For now, Broward and Miami-Dade are staying out of it, but the outcome has big implications for two counties that lead the state in PACE contracts.
The case in Tallahassee shapes up as a major legal test for the few but hard-won consumer protections already in place across the state, including new ones in Miami-Dade County, and, perhaps, the future of Florida’s PACE program.
And it could also impact nearly 13,000 property owners across Florida who’ve recently signed agreements with Florida PACE Funding Agency for more than $500 million in home improvement projects — with no guarantee that the tax-lien arrangement they agreed to will stick. Potentially, they could be hit with big bills from contractors or lenders instead.
The Florida PACE Funding Agency, meanwhile, has launched its own public relations offensive, taken multiple tax collectors to court and vowed to take the case to Florida’s Supreme Court if the judge doesn’t rule its way.
Mike Moran, executive director of Florida PACE, strongly defends his agency’s actions as well as the industry itself. He argues his quasi-governmental agency has its own authority to levy property taxes. He paints the agency’s statewide expansion as a plus for the state and consumers, an opportunity for people who might not otherwise qualify for conventional loans to make crucial home repairs at a cheaper price (usually 9 to 11% interest) than a credit card.
“I can’t finance because you don’t like your kitchen counter top. It has to be a public purpose, home hardening and energy efficiency,” he said. “If you take this option away, they’re just going to put it on a 29% credit card.”
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Going rogue
Up until last year, the PACE program worked like this: groups like the Florida PACE Agency, which serve as middlemen between homeowners and loan companies like FortiFi and Home Run Financing, needed a county’s permission to work within its boundaries.
Unlike a traditional bank loan, which is based on credit and financial records, PACE agreements are based on home equity. In exchange for the cash to complete a construction project, PACE providers put a lien on the property and collect annual payments through the property tax bill, which is gathered by a county property tax collector.
The bump to the tax bill can be steep, in some cases a 200% to 300% rise, and unlike a loan from a bank, failing to pay a tax bill can lead to foreclosure.
As the program grew in popularity across Florida in the last decade, tax collectors started hearing complaints from residents who didn’t understand why their tax bills had risen so steeply, or believed they had been signed up for the program under false pretenses by contractors.
In response, several counties passed new consumer protections like limiting loans to the lifespan of the product, requiring recorded phone calls and more thorough disclosure forms. Others did nothing, leaving a patchwork of protections across the state.
Then, starting in January, the Florida PACE Funding Agency abruptly announced that it no longer had to follow any of those rules, thanks to a Leon County judge’s ruling.
A ruling changes landscape
It was supposed to be a routine hearing, the same kind PACE agencies across Florida regularly attend to ensure they’re checking the right financial boxes. But instead of just asking the judge if his bond documents were in order, Moran asked the judge to rule on whether Florida PACE needed permission from a local government to operate within its borders.
In his ruling, the judge said no, they didn’t need permission.
Moran said that gives Florida PACE Funding Agency the right to operate in any county in Florida, including those that have explicitly banned the program.
“We do all of those consumer protections. There’s not a single one that someone asked us to do that we aren’t doing,” he told the Miami Herald. In court records, however, Alachua County said Moran “vehemently” fought a new consumer protection it tried to enact in 2022, and Leon County said Moran negotiated with the county to tweak some of its proposed protections the same year.
Tax collectors stop collecting
Tax collectors across the state have fought Moran’s moves. They sent cease and desist letters, passed county commission resolutions and called in county attorneys and legislators. At least 30 tax collectors have joined a lawsuit against Florida PACE over the issue.
“What a judge did in Tallahassee should never have happened in a bond-type hearing,” said Mike Fasano, Pasco County’s tax collector and a longtime vocal critic of PACE. “That’s not what the Legislature had any intent of happening. There was always supposed to be this interlocal agreement.”
As the fight spread to new counties, Florida PACE continued to sign up thousands of homeowners in counties across the state without their permission, including Alachua, Hillsborough and Palm Beach.
In response, some tax collectors said they weren’t going to collect the PACE assessments tacked on to their residents’ tax bills.
“I believe the responsibility tax collectors have is we’re only going to collect what is proper and authorized on the tax rolls. As it stands right now, these assessments are not proper or authorized, so they’re not getting collected,” Rob Stoneburner, Collier County’s tax collector, told the Herald.
That left Florida PACE scrambling to recoup its investments and quell questions from its investors. In an October news release, Moran said bondholders and private investors withdrew funding from Florida.
“The consequences of this withdrawal are far-reaching, impacting tens of millions of dollars that were to be used to pay contractors who have recently completed or are currently working on renovation projects. Furthermore, many ongoing projects face uncertainty, potentially leaving homeowners in a precarious financial situation,” he wrote.
At that, Moran sued.
He took multiple tax collectors to court to force them to collect the assessments he insists are legally valid, based on the Leon County ruling. So far, judges have agreed with his argument in some counties, including Hernando and Sarasota, where he is chairperson of the county commission and is running for tax collector, and disagreed in others, including Alachua, Bradford and Hillsborough.
“We don’t do ‘mother may I’ to another governmental authority to tell them to put it on the tax bill, we are the governmental authority,” Moran said. “There are a billion dollars of bondholders on the street in Florida that need to be paid back, and property tax collectors need to put this on the tax bill. That is not a complicated discussion.”
What the courts say
Experts say this drama will end in two ways. Either a judge rules that Moran is right or wrong, or the Florida Legislature tweaks the rules of PACE to resolve the dispute.
Stoneburner, the tax collector from Collier, said tax collectors across the state need “a clear answer” on whether or not Florida PACE needs permission from a county to operate there.
“Either they’re right or they’re not right. If they’re right, OK, in my mind it’s going to be the Wild West because then all the other PACE providers will do the same type of thing, they’re going to operate however they want,” he said.
But Moran said that even if the Legislature moves to fix the issue in the upcoming session — or get rid of PACE entirely — he still wants the courts to weigh in.
“If that curtain went down and PACE is gone, you still have that billion dollars of bondholders that need to get paid back,” he said.
That decision could come as soon as February, when the same Leon County judge whose ruling set off the crisis has agreed to revisit the discussion, after a legal push from at least 30 tax collectors across the state.
Colorado Springs is a charming mountain city with access to some of the most scenic hiking trails in the Front Range. Home to Garden of the Gods, the Air Force Academy and the Olympic Training Center, this growing burg is brimming with culture and amenities.
With an average of 300 sunny days per year, Colorado is an understandably desirable place to live and has seen steady growth in population for years. Despite the influx of new residents, Colorado Springs still maintains the welcoming vibe of a small town and is consistently ranked as one of the best places to live in the Centennial State. But does its small-town charm translate to small-town prices?
Right now, the cost of living in Colorado Springs is 3.4 percent above the national average. This number continues to grow. Compared with the nearby city of Denver, housing prices in Colorado Springs are currently 32.1 percent lower than the Mile High City.
Explore the costs of living in Colorado Springs, from housing to food and healthcare, and discover if a move to the Front Range is right for you.
Housing costs in Colorado Springs
The housing market in Colorado Springs is competitive and fast-paced, but renters are in luck.
The average price of a one-bedroom in Colorado Springs is currently $1,024 per month, a decrease of 24.6 percent from the previous year. Of course, this number is dependent mainly on the neighborhood.
Among the most expensive neighborhoods are Kissing Camels, Norwood and Wagon Trails. The average cost-per-month of a one-bedroom apartment ranges from $1,548 to $1,723.
Areas that price out closer to the city’s average are East Colorado Springs, Garden Ranch and Ivywild, with the average cost of a one-bedroom falling between $1,000 and $1,068 per month in these areas.
If you’re looking for a centrally located home close to downtown, you’ll find the most affordable apartments in Stratton Meadows, where a one-bedroom averages $887 per month, or Shooks Run at $846 per month.
Currently, the median sale price for a home in Colorado Springs is $377,643. As of May 2021, home prices are up 21.6 percent since last year, according to Redfin. The local housing market is highly competitive, meaning that most homes receive multiple offers. Homes are also selling for about 4 percent more than the list price, on average.
Food costs in Colorado Springs
Colorado Springs boasts a wide array of international cuisine — from authentic Mexican and Indian to German and British fare. There’s an abundance of culinary opportunities with dining options ranging from casual family dining to luxurious special-occasion restaurants.
Outdoor dining is another popular choice here; between the city’s breathtaking views of the Rocky Mountains and the famously sunny weather, there’s no shortage of patio seating.
Groceries in Colorado Springs will cost you around 3.4 percent less than the national average. You can expect to pay $3.57 for a loaf of bread, $1.27 for a dozen eggs and $4.33 for ground beef.
Locals often hunt for bargains and ultra-fresh produce at one of the many farmer’s markets in the city.
Utility costs in Colorado Springs
Colorado has some of the best skiing in the world, but all that snow means your heating bill will see a jump in the winter.
Overall, the utility costs in Colorado Springs are just 0.9 percent below the national average. You can expect your total energy cost to come in around $165.12 per month.
Transportation costs in Colorado Springs
Traffic in Colorado Springs is surprisingly uncongested for a city of its size.
Commuters spend an average of four extra minutes per 30 minutes of commute-time during the morning rush hour and seven more minutes in the evening, with an average commute of around 22 minutes.
Heavy congestion on major roads is rare, and many members of the community choose to drive. You can expect to pay $2.41 for a gallon of regular unleaded at the pump.
Downtown Colorado Springs and Old Colorado City employ parking meters, with the parking charge per hour starting at $1.25 closest to the city center. Meters on the periphery of downtown will cost you $0.75 per hour. City-operated garages downtown charge a daily maximum of $9 or $70 per month. Parking outside of the city center is typically free.
Colorado Springs public transportation
Those who prefer public transit can take the Mountain Metro Transit, the city’s bus system, with a comprehensive route traversing most of the town. The basic cash fare for adults is $1.75, while youths, seniors and Medicaid or disabled folks will pay $0.85. Transfers are free and issued upon request with paid fare and are good for 2 hours or three rides on one-way trips.
Discount Metro tickets can also be purchased. Unlimited ride Day Passes coming in at $4 and unlimited 31-Day Tickets at $63. The city’s transit score is 20.
Colorado Springs has a bike score of 46 and a walk score of 37, with miles of paved bike paths inside and around the city for recreational cycling and walking. The mostly-paved Pikes Peak Greenway runs through the center of town, connecting to the Santa Fe Trail in the north and the Fountain Creek Regional Trail in the south. Other inner-city bike paths include the Cottonwood Creek Trail, Shooks Run Trail and the Midland Trail. Interactive bike maps make planning your commute or joyride a breeze.
Overall, the cost of living for transportation in the city is 9 percent above the national average.
Healthcare costs in Colorado Springs
Colorado Springs has been a destination for health-seekers since its early days as a haven for tuberculosis patients. Many doctors in the 19th century believed that high altitude and sunshine were a cure for TB. Coincidentally, the influx of wealthy TB patients to the then-resort town of Colorado Springs was instrumental in putting the small city on the map.
Today, Colorado Springs is home to the award-winning UCHealth Memorial Hospital and Penrose-St. Francis Health Services. Kids can receive high-quality care at the new Children’s Hospital Colorado Springs location.
Calculating average healthcare costs is difficult because these costs vary widely depending on each person’s health situation. The local healthcare costs are 4.6 percent higher than the national average.
A regular doctor’s visit might cost an average of $126.71, while a trip to the dentist will cost $105.77 on average. Prescription drugs, without insurance, cost an average of $471.44, and a bottle of ibuprofen will cost around $9.03.
Goods and services costs in Colorado Springs
Colorado Springs boasts a wide selection of fitness facilities and opportunities, whether you’re a CrossFit aficionado or more of a Pilates person. Yoga enthusiasts can expect to pay a little more than $15 per class.
If you want to save a few bucks and still be healthy, check out the nearby hiking trails. Colorado Springs boasts several open spaces within the city limits, many of which contain trail systems for easy access hiking.
Garden of the Gods, located on the west side of town, is an iconic landmark and recreation hotspot for locals and tourists alike. Admission is free for this city-owned National Natural Landmark.
If you’re a pet owner, you can expect to pay an average of $56.54 per routine vet visit. Pet licensing —required for all dogs and cats over the age of 4 months — can cost anywhere from $10 to $75 depending on a variety of factors.
Overall, the cost of goods and services in Colorado Springs is about 3 percent more than the national average.
Taxes in Colorado Springs
Colorado Springs resides entirely within El Paso County. The Colorado sales tax rate is currently 2.9 percent, while the El Paso County sales tax is 1.23 percent.
Colorado Springs recently reduced its sales tax to 3.07 percent. Therefore, the minimum combined sales tax for Colorado Springs is now 8.2 percent. So, when you spend $100 at the Promenade Shops at Briargate, for example, you’ll pay $8.20 in sales tax.
Colorado does not tax most groceries.
How much do you need to earn to live in Colorado Springs?
The average rent for a one-bedroom apartment in the city is $1,024.
Most financial advisors recommend spending no more than 30 percent of your annual income on rent. This means you would need to earn around $40,960 per year to comfortably afford a one-bedroom apartment in Colorado Springs.
To give these numbers some context, the median household income in Colorado Springs is about $65,000 and the per capita median income is around $34,000.
Use our rent calculator to quickly discover how much you can afford to spend on rent with your current salary.
Living in Colorado Springs
Recently ranked fourth Best Place to Live by U.S. News & World Report, Colorado Springs is a mountain oasis. Gorgeous weather and miles of surrounding natural beauty make this city a unique treasure in the heart of the American West.
With a growing economy and an increasing demand for tech-talent labor, there’s never been a better time to relocate. Find your ideal Colorado Springs apartment to rent today.
Cost of living information comes from The Council for Community and Economic Research.
Rent prices are based on a rolling weighted average from Apartment Guide and Rent.’s multifamily rental property inventory of one-bedroom apartments in April 2021. Our team uses a weighted average formula that more accurately represents price availability for each individual unit type and reduces the influence of seasonality on rent prices in specific markets.
The rent information included in this article is used for illustrative purposes only. The data contained herein do not constitute financial advice or a pricing guarantee for any apartment.
For a third day, average mortgage rates barely moved yesterday. But that’s good because it means last week’s big falls remain effectively uneroded.
First thing, it was again looking as if mortgage rates today might fall, perhaps modestly or moderately. However, that could change as the hours pass.
Current mortgage and refinance rates
Find your lowest rate. Start here
Program
Mortgage Rate
APR*
Change
Conventional 30-year fixed
7.125%
7.14%
-0.075
Conventional 15-year fixed
6.385%
6.415%
-0.1
Conventional 20-year fixed
6.975%
7%
-0.045
Conventional 10-year fixed
6.12%
6.145%
-0.065
30-year fixed FHA
5.98%
6.88%
-0.095
30-year fixed VA
6.165%
6.315%
-0.13
5/1 ARM Conventional
6.425%
7.675%
-0.035
Rates are provided by our partner network, and may not reflect the market. Your rate might be different. Click here for a personalized rate quote. See our rate assumptions See our rate assumptions here.
Should you lock your mortgage rate today?
Every day that passes makes a corrective bounce (when mortgage rates rise as markets think they’ve got carried away) less likely. And it reinforces my hope that those rates are in a downward trend that could last well into next year.
So, my personal rate lock recommendations are:
LOCK if closing in 7 days
FLOAT if closing in 15 days
FLOAT if closing in 30 days
FLOAT if closing in 45 days
FLOATif closing in 60days
However, with so much uncertainty at the moment, your instincts could easily turn out to be as good as mine — or better. So let your gut and your own tolerance for risk help guide you.
>Related: 7 Tips to get the best refinance rate
Market data affecting today’s mortgage rates
Here’s a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data are mostly compared with roughly the same time the business day before, so much of the movement will often have happened in the previous session. The numbers are:
The yield on 10-year Treasury notes edged lower to 3.90% from 3.92%. (Good for mortgage rates.) More than any other market, mortgage rates typically tend to follow these particular Treasury bond yields
Major stock indexes were mostly falling this morning. (Good for mortgage rates.) When investors buy shares, they’re often selling bonds, which pushes those prices down and increases yields and mortgage rates. The opposite may happen when indexes are lower. But this is an imperfect relationship
Oil prices climbed to $75.14 from $73.12 a barrel. (Bad for mortgage rates*.) Energy prices play a prominent role in creating inflation and also point to future economic activity
Goldprices held steady at $2,049 an ounce. (Neutral for mortgage rates*.) It is generally better for rates when gold prices rise and worse when they fall. Gold tends to rise when investors worry about the economy.
CNN Business Fear & Greed index — ticked down to 77 from 78. (Good for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while “fearful” investors do the opposite. So lower readings are often better than higher ones
*A movement of less than $20 on gold prices or 40 cents on oil ones is a change of 1% or less. So we only count meaningful differences as good or bad for mortgage rates.
Caveats about markets and rates
Before the pandemic, post-pandemic upheavals, and war in Ukraine, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that’s no longer the case. We still make daily calls. And are usually right. But our record for accuracy won’t achieve its former high levels until things settle down.
So, use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, mortgage rates today look likely to decrease. However, be aware that “intraday swings” (when rates change speed or direction during the day) are a common feature right now.
Find your lowest rate. Start here
What’s driving mortgage rates today?
The Federal Reserve
This morning’s Wall Street Journal (paywall) observed: “After their policy meeting last week, Fed officials released projections of at least three rate cuts [in general interest rates] next year. They have since been flummoxed that investors expect even faster and deeper cuts. The result: Confusion over when and how quickly the Fed might cut as the central bank tries to bring inflation down without a painful recession.”
This could turn into a real issue that could push mortgage rates higher, probably in the new year. Wall Street has a long and inglorious record of hearing what it wants the Fed to say rather than what the Fed actually says. And we’ve seen quite recently examples of sharp rises in mortgage rates when markets’ wishful thinking collides with reality.
Still, last week’s Fed meeting did deliver genuinely good news. And, even if mortgage rates rise when investors face the cold light of dawning reality, I’m optimistic that we’ll keep at least most of the recent gains. Just be aware that the path to lower mortgage rates is unlikely to be smooth.
Today
This morning’s economic reports cover existing home sales in November and consumer confidence in December. They’re both published too late for me to assess their likely impact on markets and mortgage rates.
They could push mortgage rates a little higher or lower, but they rarely move them far or for long.
Tomorrow
Tomorrow brings gross domestic product (GDP) figures for the third quarter of this year. This will be the third and final estimate for this number.
The second estimate put GDP growth at 5.2%, up from 2.1% in the second quarter. MarketWatch says that market expectations for tomorrow’s figure have recently been slightly scaled down to 5.1%.
If the actual number tomorrow is lower than 5.1%, that could drag mortgage rates lower. But, if it’s higher, that could push those rates upward.
Friday
We’re due November’s personal consumption expenditures (PCE) price index on Friday. Markets might get nervous if that shows inflation rising more than expected because that could destroy the Fed’s new-found optimism.
More on what to expect from the PCE report tomorrow.
Don’t forget you can always learn more about what’s driving mortgage rates in the most recent weekend edition of this daily report. These provide a more detailed analysis of what’s happening. They are published each Saturday morning soon after 10 a.m. (ET) and include a preview of the following week.
Recent trends
According to Freddie Mac’s archives, the weekly all-time low for mortgage rates was set on Jan. 7, 2021, when it stood at 2.65% for conventional, 30-year, fixed-rate mortgages.
Freddie’s Dec. 14 report put that same weekly average at 6.95%, down from the previous week’s 7.03%. Freddie’s data are almost always out of date by the time it announces its weekly figures.
Expert forecasts for mortgage rates
Looking further ahead, Fannie Mae and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.
And here are their rate forecasts for the current quarter (Q4/23) and the following three quarters (Q1/24, Q2/24 and Q3/24).
The numbers in the table below are for 30-year, fixed-rate mortgages. Fannie’s were updated on Dec. 19 and the MBA’s on Dec. 13.
Forecaster
Q4/23
Q1/24
Q2/24
Q3/24
Fannie Mae
7.4%
7.0%
6.8%
6.6%
MBA
7.4%
7.0%
6.6%
6.3%
Of course, given so many unknowables, both these forecasts might be even more speculative than usual. And their past record for accuracy hasn’t been wildly impressive.
Important notes on today’s mortgage rates
Here are some things you need to know:
Typically, mortgage rates go up when the economy’s doing well and down when it’s in trouble. But there are exceptions. Read ‘How mortgage rates are determined and why you should care’
Only “top-tier” borrowers (with stellar credit scores, big down payments, and very healthy finances) get the ultralow mortgage rates you’ll see advertised
Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the broader trend over time
When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
Refinance rates are typically close to those for purchases.
A lot is going on at the moment. And nobody can claim to know with certainty what will happen to mortgage rates in the coming hours, days, weeks or months.
Find your lowest mortgage rate today
You should comparison shop widely, no matter what sort of mortgage you want. Federal regulator the Consumer Financial Protection Bureau found in May 2023:
“Mortgage borrowers are paying around $100 a month more depending on which lender they choose, for the same type of loan and the same consumer characteristics (such as credit score and down payment).”
In other words, over the lifetime of a 30-year loan, homebuyers who don’t bother to get quotes from multiple lenders risk losing an average of $36,000. What could you do with that sort of money?
Verify your new rate
Mortgage rate methodology
The Mortgage Reports receives rates based on selected criteria from multiple lending partners each day. We arrive at an average rate and APR for each loan type to display in our chart. Because we average an array of rates, it gives you a better idea of what you might find in the marketplace. Furthermore, we average rates for the same loan types. For example, FHA fixed with FHA fixed. The end result is a good snapshot of daily rates and how they change over time.
How your mortgage interest rate is determined
Mortgage and refinance rates vary a lot depending on each borrower’s unique situation.
Factors that determine your mortgage interest rate include:
Overall strength of the economy — A strong economy usually means higher rates, while a weaker one can push current mortgage rates down to promote borrowing
Lender capacity — When a lender is very busy, it will increase rates to deter new business and give its loan officers some breathing room
Property type (condo, single-family, town house, etc.) — A primary residence, meaning a home you plan to live in full time, will have a lower interest rate. Investment properties, second homes, and vacation homes have higher mortgage rates
Loan-to-value ratio (determined by your down payment) — Your loan-to-value ratio (LTV) compares your loan amount to the value of the home. A lower LTV, meaning a bigger down payment, gets you a lower mortgage rate
Debt-To-Income ratio — This number compares your total monthly debts to your pretax income. The more debt you currently have, the less room you’ll have in your budget for a mortgage payment
Loan term — Loans with a shorter term (like a 15-year mortgage) typically have lower rates than a 30-year loan term
Borrower’s credit score — Typically the higher your credit score is, the lower your mortgage rate, and vice versa
Mortgage discount points — Borrowers have the option to buy discount points or ‘mortgage points’ at closing. These let you pay money upfront to lower your interest rate
Remember, every mortgage lender weighs these factors a little differently.
To find the best rate for your situation, you’ll want to get personalized estimates from a few different lenders.
Verify your new rate. Start here
Are refinance rates the same as mortgage rates?
Rates for a home purchase and mortgage refinance are often similar.
However, some lenders will charge more for a refinance under certain circumstances.
Typically when rates fall, homeowners rush to refinance. They see an opportunity to lock in a lower rate and payment for the rest of their loan.
This creates a tidal wave of new work for mortgage lenders.
Unfortunately, some lenders don’t have the capacity or crew to process a large number of refinance loan applications.
In this case, a lender might raise its rates to deter new business and give loan officers time to process loans currently in the pipeline.
Also, cashing out equity can result in a higher rate when refinancing.
Cash-out refinances pose a greater risk for mortgage lenders, so they’re often priced higher than new home purchases and rate-term refinances.
Check your refinance rates today. Start here
How to get the lowest mortgage or refinance rate
Since rates can vary, always shop around when buying a house or refinancing a mortgage.
Comparison shopping can potentially save thousands, even tens of thousands of dollars over the life of your loan.
Here are a few tips to keep in mind:
1. Get multiple quotes
Many borrowers make the mistake of accepting the first mortgage or refinance offer they receive.
Some simply go with the bank they use for checking and savings since that can seem easiest.
However, your bank might not offer the best mortgage deal for you. And if you’re refinancing, your financial situation may have changed enough that your current lender is no longer your best bet.
So get multiple quotes from at least three different lenders to find the right one for you.
2. Compare Loan Estimates
When shopping for a mortgage or refinance, lenders will provide a Loan Estimate that breaks down important costs associated with the loan.
You’ll want to read these Loan Estimates carefully and compare costs and fees line-by-line, including:
Interest rate
Annual percentage rate (APR)
Monthly mortgage payment
Loan origination fees
Rate lock fees
Closing costs
Remember, the lowest interest rate isn’t always the best deal.
Annual percentage rate (APR) can help you compare the ‘real’ cost of two loans. It estimates your total yearly cost including interest and fees.
Also, pay close attention to your closing costs.
Some lenders may bring their rates down by charging more upfront via discount points. These can add thousands to your out-of-pocket costs.
3. Negotiate your mortgage rate
You can also negotiate your mortgage rate to get a better deal.
Let’s say you get loan estimates from two lenders. Lender A offers the better rate, but you prefer your loan terms from Lender B. Talk to Lender B and see if they can beat the former’s pricing.
You might be surprised to find that a lender is willing to give you a lower interest rate in order to keep your business.
And if they’re not, keep shopping — there’s a good chance someone will.
Fixed-rate mortgage vs. adjustable-rate mortgage: Which is right for you?
Mortgage borrowers can choose between a fixed-rate mortgage and an adjustable-rate mortgage (ARM).
Fixed-rate mortgages (FRMs) have interest rates that never change unless you decide to refinance. This results in predictable monthly payments and stability over the life of your loan.
Adjustable-rate loans have a low interest rate that’s fixed for a set number of years (typically five or seven). After the initial fixed-rate period, the interest rate adjusts every year based on market conditions.
With each rate adjustment, a borrower’s mortgage rate can either increase, decrease, or stay the same. These loans are unpredictable since monthly payments can change each year.
Adjustable-rate mortgages are fitting for borrowers who expect to move before their first rate adjustment, or who can afford a higher future payment.
In most other cases, a fixed-rate mortgage is typically the safer and better choice.
Remember, if rates drop sharply, you are free to refinance and lock in a lower rate and payment later on.
How your credit score affects your mortgage rate
You don’t need a high credit score to qualify for a home purchase or refinance, but your credit score will affect your rate.
This is because credit history determines risk level.
Historically speaking, borrowers with higher credit scores are less likely to default on their mortgages, so they qualify for lower rates.
For the best rate, aim for a credit score of 720 or higher.
Mortgage programs that don’t require a high score include:
Conventional home loans — minimum 620 credit score
FHA loans — minimum 500 credit score (with a 10% down payment) or 580 (with a 3.5% down payment)
VA loans — no minimum credit score, but 620 is common
USDA loans — minimum 640 credit score
Ideally, you want to check your credit report and score at least 6 months before applying for a mortgage. This gives you time to sort out any errors and make sure your score is as high as possible.
If you’re ready to apply now, it’s still worth checking so you have a good idea of what loan programs you might qualify for and how your score will affect your rate.
You can get your credit report from AnnualCreditReport.com and your score from MyFico.com.
How big of a down payment do I need?
Nowadays, mortgage programs don’t require the conventional 20 percent down.
In fact, first-time home buyers put only 6 percent down on average.
Down payment minimums vary depending on the loan program. For example:
Conventional home loans require a down payment between 3% and 5%
FHA loans require 3.5% down
VA and USDA loans allow zero down payment
Jumbo loans typically require at least 5% to 10% down
Keep in mind, a higher down payment reduces your risk as a borrower and helps you negotiate a better mortgage rate.
If you are able to make a 20 percent down payment, you can avoid paying for mortgage insurance.
This is an added cost paid by the borrower, which protects their lender in case of default or foreclosure.
But a big down payment is not required.
For many people, it makes sense to make a smaller down payment in order to buy a house sooner and start building home equity.
Verify your new rate. Start here
Choosing the right type of home loan
No two mortgage loans are alike, so it’s important to know your options and choose the right type of mortgage.
The five main types of mortgages include:
Fixed-rate mortgage (FRM)
Your interest rate remains the same over the life of the loan. This is a good option for borrowers who expect to live in their homes long-term.
The most popular loan option is the 30-year mortgage, but 15- and 20-year terms are also commonly available.
Adjustable-rate mortgage (ARM)
Adjustable-rate loans have a fixed interest rate for the first few years. Then, your mortgage rate resets every year.
Your rate and payment can rise or fall annually depending on how the broader interest rate trends.
ARMs are ideal for borrowers who expect to move prior to their first rate adjustment (usually in 5 or 7 years).
For those who plan to stay in their home long-term, a fixed-rate mortgage is typically recommended.
Jumbo mortgage
A jumbo loan is a mortgage that exceeds the conforming loan limit set by Fannie Mae and Freddie Mac.
In 2023, the conforming loan limit is $726,200 in most areas.
Jumbo loans are perfect for borrowers who need a larger loan to purchase a high-priced property, especially in big cities with high real estate values.
FHA mortgage
A government loan backed by the Federal Housing Administration for low- to moderate-income borrowers. FHA loans feature low credit score and down payment requirements.
VA mortgage
A government loan backed by the Department of Veterans Affairs. To be eligible, you must be active-duty military, a veteran, a Reservist or National Guard service member, or an eligible spouse.
VA loans allow no down payment and have exceptionally low mortgage rates.
USDA mortgage
USDA loans are a government program backed by the U.S. Department of Agriculture. They offer a no-down-payment solution for borrowers who purchase real estate in an eligible rural area. To qualify, your income must be at or below the local median.
Bank statement loan
Borrowers can qualify for a mortgage without tax returns, using their personal or business bank account. This is an option for self-employed or seasonally-employed borrowers.
Portfolio/Non-QM loan
These are mortgages that lenders don’t sell on the secondary mortgage market. This gives lenders the flexibility to set their own guidelines.
Non-QM loans may have lower credit score requirements, or offer low-down-payment options without mortgage insurance.
Choosing the right mortgage lender
The lender or loan program that’s right for one person might not be right for another.
Explore your options and then pick a loan based on your credit score, down payment, and financial goals, as well as local home prices.
Whether you’re getting a mortgage for a home purchase or a refinance, always shop around and compare rates and terms.
Typically, it only takes a few hours to get quotes from multiple lenders — and it could save you thousands in the long run.
Time to make a move? Let us find the right mortgage for you
Current mortgage rates methodology
We receive current mortgage rates each day from a network of mortgage lenders that offer home purchase and refinance loans. Mortgage rates shown here are based on sample borrower profiles that vary by loan type. See our full loan assumptions here.
There are many changes you can make to reduce the environmental impact your home and your daily life has on the planet. Even simple adjustments like using green cleaning products, finding ways to reuse your kitchen scraps, or locking your windows shut, can lead to less waste and energy savings. Whether you just bought a house in Miami, Los Angeles, or anywhere in between, here are some great ways to save energy, reduce your carbon footprint, and save money all from the comfort of your own home.
Reconsider your grocery shopping habits
To reduce waste and save energy at home, adopt eco-friendly grocery shopping habits.
“Subscribing to a milk delivery service with reusable glass bottles, reusing bags at a bulk grocery store, and selecting glass or metal packaging can make a tremendous difference in reducing our consumption of plastics,” says Lyons, CO-based BrightHeart Decor.
These simple adjustments in your grocery shopping routine can make a significant difference in promoting sustainability at home.
Save energy with LED lighting
In addition to upgrading the look of your home’s interior, changing up the lighting can make your home more efficient. LED bulbs are much more energy-efficient than other alternatives, and incorporating them throughout your home is an easy way to conserve energy.
“The easiest DIY way to save energy is to install LED lighting and click the thermostat one to two degrees up or down,” according to Edge Energy “Another way to conserve energy is to get an energy audit and do basic installations of any cost-effective retrofits.”
Reduce your household’s consumption of water
A common area of waste in many households is water usage. The average US household consumes over 300 gallons of water per day, and much of this is unnecessary. If you’re looking for ways to save water, simply being mindful of when the water is running unnecessarily can go a long way.
“Try cutting down on your daily water usage at home by saving six liters of water a minute by turning off your tap while you brush your teeth,” suggests Bamboodu, an online store that specializes in eco-friendly products. “Use natural biodegradable cleaning products that don’t contain chemicals, and install taps and showers with automatic shut-off.”
Use smart home technology to save energy and avoid expensive repairs
We all know that technology has made our lives easier, but it can also save money by reducing energy waste. Sensors on home appliances can not only prevent food and energy waste, but also alert homeowners to potential issues that could prove costly if missed.
“Smart homes enable homeowners to save energy and money by automatically regulating lights and thermostats using geofencing and motion sensor technology,” says Agile Home Automation. “Leak detectors can notify homeowners of problems before they become costly repair situations. Freezer and refrigerator sensors can notify homeowners if a door is not closed properly, or if the unit is beginning to fail before the food is ruined.”
“Using automation for lighting, temperature control, and window coverings is the most cost-effective way to reduce waste, and manage and save energy use in your home,” adds Brad Smith, president of Audio Video Design. “Today’s products sync with circadian rhythms and the astronomical clock for personal and precise customization.”
Be friendly to the environment (and your pocket) by going solar
With recent improvements in solar technology, saving money on electricity with solar panels is easier than it’s ever been. Take advantage of clean energy and save yourself some money in the process.
“Homeowners can install solar on their roof or property and pay no more than they were paying for electricity before, and hedge against rising electric costs while making the planet a cleaner place to live,” says Madison, NJ -based Green House Solar. “Not only will solar save energy, but it will also increase the resale value of your home.”
“Homeowners can save energy and get a greater return on investment by pairing their solar system with a smart home system,” adds Freedom Forever, a Temecula, CA-based company that combines solar and smart technology. “These systems enable homeowners to schedule when appliances consume electricity, allowing you to use more of your solar power and send less to the grid.
Find ways to save and reuse your produce
A great way to prevent food waste is by getting the most out of your produce scraps. Get more out of your veggies by using the scraps for a homemade vegetable broth.
“To make the most of your produce, save your vegetable scraps,” says blogger Nutti Nelli. “Once you fill up a half-gallon of scraps, bring five cups of water to a boil and add your veggie scraps, one teaspoon of salt, and one teaspoon of black pepper, and simmer for one hour. Drain the scraps, and now you have four cups of vegetable broth to use for cooking, soups, curries, or stews.”
Think twice about the cleaning products you’re using
When it comes to eco-friendly cleaning products, the first thing that probably comes to mind is biodegradable products. While these are great, you can go a step further by eliminating plastic packaging entirely.
“Save space and eliminate plastic from your cleaning routine when you use USDA certified biobased products,” says Beyond Clean Products, a company that specializes in eco-friendly cleaning products. “Consider incorporating detergent sheets and auto dish tabs that are 100 percent plastic-free.”
Keep windows locked to avoid any air leaks
Whether you’re running the AC during the summer or heating your home in the chilly winter months, the last thing you want is to run up your bill because of air leaks. Locking your windows not only secures your home, but also the air inside it.
“Keep your windows locked to save energy in your home, says Home Energy Saving Solutions. “The lock is not only for security, but it also keeps the window close-packed and creates a seal along the weather-stripping of the window. An unlocked window is an open window.”
Recycle your leftover household paint
If you’ve got leftover paint lying around after a recent home project, you may be wondering how exactly you’re supposed to get rid of it. Product Care Recycling cautions against simply throwing old paint in the trash.
“A fresh coat of paint can give your home new life,” they say. “However, leftover paint, like other hazardous household products, does not belong in the trash. It should be recycled to avoid contaminating our soil and water sources and to divert landfill waste.”
Enrich your soil and decrease landfill waste
Whether you already have a home garden or just want to help the environment, composting is a great way to get the most out of your food waste. The planet will appreciate it and so will your plants.
“Composting is one of the most impactful actions you can take to both reduce household waste heading to landfills and create an ultra-nourishing natural resource that your garden will love,” says Sustainable Jungle, a website that shares sustainability tips and tricks. “Some cities even offer discounts on composters to help encourage this community supporting activity.”
Use dimmable indoor lighting
Home lighting is another area where energy waste can take place. Since most light bulbs operate at full capacity when turned on, you may end up using more energy than you need to keep your home lit, especially during the day. Dimmable lights give your home a more natural glow, saving energy in the process.
“One of the most effective ways to reduce your electricity bill is to install a lighting control system or smart lighting,” says TSP Smart Spaces. “We’re all used to running our lights at 100 percent, but the reality is that not only do we not need to use 100 percent of the energy of a bulb all the time. Dimmable LEDs create a much more enjoyable living experience, and natural lighting that costs 20 to 50 percent less to run compared to regular switches.”