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Healthy down payment, stellar credit, and pre-approved mortgage are three factors that can help homebuyers land their dream home. A new study by LendingTree used this criteria to rank the 100 largest cities on the basis of how competitive they were.
LendingTree looked at 1.5 million purchase mortgage loan requests and then ranked each city based on the share of buyers shopping for mortgage before identifying the house they want; average down payment percentage; and percentage of buyers who have prime credit above 680.
It came as no surprise therefore when California markets dominated the top 10 list with San Francisco and San Jose leading the 2018 rankings at first and second place respectively. A large number of creditworthy borrowers made these cities some of the most challenging markets for prospective home shoppers.
The study found that around 60 percent of home shoppers applied for a mortgage before identifying a house in both these cities, which also had the highest average down payment of any region.
In fact, cities on the west coast, with the exception of Colorado, were among the top 10 with Denver, Colorado; San Diego, California; Ventura, California; Los Angeles, California; Seattle, Washington; Honolulu, Hawaii; Portland, Oregon; and Sacramento, California rounding up the top 10 most competitive markets.
On the other hand, the study found three cities where less than half of the home shoppers applied for mortgage before house hunting; the average shopper offered a down payment of only 12 percent; and less than 40 percent of shoppers had prime credit scores. These cities were led by Youngstown, Ohio; McAllen, Texas; and Scranton, Pennsylvania.
The study said that most of the cities on the most accessible list belonged to the rustbelt and southern states where homeownership is accessible to a larger part of the population. Other cities that were most accessible included, El Paso, Texas; Dayton, Ohio; Augusta, Georgia; Birmingham, Alabama; Winston-Salem, North Carolina; Little Rock, Arkansas; and Harrisburg, Pennsylvania.
