Mortgage Lenders & Homebuyers Alike Believe in Cleveland. Here’s Why You Should, Too.

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Lenders Have a Major Opportunity in the Cleveland Housing Market

Sometimes known as "Believeland," the Cleveland metro really does give its locals a lot to believe in. From being the birthplace of Superman to celebrating the Cavaliers' historic 2016 championship win-ending a 52-year drought-the city has its fair share of proud moments.

But beyond its cultural and sports highlights, Cleveland stands out as one of the most affordable and undervalued housing markets in the nation. This makes it a prime location for renters looking to transition to homeownership-and for mortgage lenders who can capitalize on a favorable price-to-rent ratio in helping these buyers make the switch.

A Market Ripe for Homeownership

Cleveland is proving to be a top contender for homebuyers seeking affordability and long-term value. In August 2024, it was the #1 city for buyers among the top 50 most populous metros, and to this day, it remains among the best locations to purchase a home -with values rising a steady 5.29% year over year. Combine that with some of the lowest price-to-rent ratios in the nation, and buying a house in The Land doesn't have to be a dream-it can be a reality, and a financially savvy one, at that.

According to recent market data, the typical mortgage payment in Cleveland is $265 less per month than the typical rental payment. This cost advantage provides homebuyers with immediate savings and financial benefits in the long run, making homeownership an even more compelling proposition. As financial institutions continue to support buyers in this market, mortgage products that cater to first-time homeowners and lower-income borrowers can play a pivotal role in increasing homeownership rates.

Affordability at Its Core

Home affordability is a critical driver in the Cleveland real estate market. The city ranks #2 in the nation for undervalued homes for sale, ensuring that buyers get more house for their money. Additionally, Cleveland is the second most affordable large city for homebuyers, underscoring its appeal to those who'd like to invest in property of their own.

For mortgage lenders, this affordability translates to more financing opportunities, particularly among first-time buyers. With an average home price that allows for an additional $128,000 in buying power, Cleveland provides a strong case for securing a mortgage over renting.

Mortgage Savings: A Game-Changer

The ability to own a home for less than the cost of renting is a game-changer, and Cleveland is a leader among major cities in homeowner savings. Home loans present a financial advantage, allowing residents to build equity rather than funneling money into rent payments. This is especially important as housing demand continues to grow amid revitalization efforts throughout the city.

A Favorable Market for Lenders

For financial institutions, Cleveland's real estate market presents an opportunity to offer innovative mortgage solutions that cater to affordability-conscious buyers. Low down payment options, first-time homebuyer programs, and competitive interest rates can make homeownership even more accessible to those looking to take advantage of Cleveland's price-to-rent advantages.

With mortgage payments that are significantly lower than rent and a spot among the most undervalued cities in the U.S., Cleveland is a prime market for financial institutions seeking to grow their lending portfolios-and now is the time to position your mortgage offerings to serve buyers looking for a cost-effective path to homeownership.

By leveraging Cleveland's affordability and market strength, lenders can connect with aspiring homeowners, help them achieve financial stability, and drive lending growth in one of the most promising housing markets in the nation.

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