10+ Best Places to Buy Houses in America for $500K [2023]

The average list price for an existing home in the US was $361,500 as of June 2022, with an average list price of $428,700. Though buying a house for $500,000 and below requires effort, research, and intelligent investment, many affordable neighborhoods offer fantastic value and proximity to city services.

Best Places to Buy Houses in America for 500K

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Buying a house can be overwhelming, especially if you’re looking for one in a desirable area and are unfamiliar with the housing market. But did you know there are plenty of places to purchase houses in America under $500,000?

In this article, we’ll explore some of the best places to buy a house on a budget and discuss why they offer such great deals. There’s something for everyone in these locations, from large cities to cozy suburbs.

With research and strategic planning, you could live in your dream house sooner than you think! Keep reading to learn the best places to buy homes in America for 500K.

Overview of the Housing Market

According to Statista, the median price of an existing home in the U.S. was $361,500 as of June 2022, i.e., an increase from a year ago. Furthermore, the average listing price for all homes across the Country was $428,700 in June 2022. Costs vary significantly depending on the city, from as low as $100,000 to over $1 million.

With careful research and sound investments, it’s possible to find an affordable home for around $500,000 or less in many markets. The key is finding a market that can provide you with a great price and access to amenities within a city.

The city housing market can be overwhelming, particularly for budget-conscious buyers. But with the right tools, you can find great deals on homes that offer access to city services and amenities. In addition, the location of these properties is in up-and-coming areas that developers have just begun to target.

Prices may be lower than in other locations, but they can still offer access to city life. Buyers looking for a home may feel overwhelmed when trying to find an affordable property in a desirable area.

But there are plenty of reasons to consider purchasing a house. Moreover, the obvious financial benefit of owning real estate and other advantages come with buying a property.

Overview of What a $500,000 Home Looks Like

A home priced at $500,000 can look quite different depending on the location and amenities. Generally, a home in this price range usually offers two spacious bedrooms, private balconies, three bathrooms, and a two-car garage.

You may also find features such as a renovated kitchen with an open floor plan, a gas fireplace, a stone patio or deck for entertaining, and a fenced backyard. Vaulted ceilings, walk-in closets, and even a heated swimming pool are standard amenities in homes of this price range. You can also find a game room in this range if you do research.

Depending on the neighborhood and home size, you can expect to find plenty of features that make your home look like it costs much more than $500K! However, with careful research, you can find the perfect home, getting the most out of your budget.

When buying a home on a budget, there are plenty of options for budget-conscious buyers looking for their dream home. Location plays an essential role in the overall cost of a property and can be a great way to find an affordable deal.

With just $500,000 or less to spend on housing, it’s possible to find a great property in cities in the United States. Now that you are ready to explore the options, it’s time to look at Cities on West Coast.

West Coast Cities

West Coast cities offer great homes for those looking to buy on a budget. From San Francisco and Los Angeles to Seattle and Portland – the west coast has something for every buyer. We will look at the best four cities on the West Coast to buy houses under $500K.

1. Los Angeles, California

Los Angeles is a beautiful place to buy a house under $500K. According to research, the median home price in Los Angeles is $600,000, meaning homes listed at $500K or less are much more accessible in this city than in other cities on the West Coast.

In addition, many neighborhoods and suburbs in Los Angeles offer homebuyers plenty of options for properties within this price range. From the luxurious districts of Beverly Hills to the more budget-friendly suburbs like Glendale and Pasadena, you can find a home under $500K in almost any part of Los Angeles.

Furthermore, over half of all homes listed in L.A. cost under $500K, so homebuyers have a great selection. Los Angeles is the place to look if you’re looking for an affordable home without compromising quality or location.

  • Potential Rental Income: $2,480 per month
  • Property tax rate: 0.59%

2. Seattle, Washington

Seattle is one of the best cities on the West Coast to buy a home for under $500K. According to Zillow, the median price of homes currently listed in Seattle is around $757,644.

However, plenty of properties are available for purchase at or below $500K, with many ranging from one to three bedrooms. You might even find five bedrooms, depending on the location. The market is competitive, however, and buyers should prepare to act quickly when they see a property that fits their budget.

With an average annual appreciation rate of 137.11% over the last ten years, Seattle is an excellent place to invest in real estate for budget-conscious buyers looking for long-term growth potential.

  • Potential Rental Income: $4,800 per month
  • Property tax rate: 0.78%

3. Portland, Oregon

Portland, Oregon, is also a great city to purchase a home on the West Coast for under $500K. The median list price in Portland is around $575,000, and the area has seen an average appreciation rate of 123.15% over the past decade. Plenty of properties are available at or below this budget threshold, with rooms ranging from one to four bedrooms.

Portland’s affordable housing market and relatively high appreciation rate make it an attractive option for budget-conscious buyers looking for a home on the West Coast.

  • Potential Rental Income: $1,748
  • Property tax rate: 1.03%

4. San Francisco, California

San Francisco, California, is one of many apparent choices when buying a house under $500K, but it can still be an excellent option for budget-conscious buyers. With an average appreciation rate of 111.65% over the past ten years, San Francisco is a great place to invest in real estate.

Prices are higher than other cities on this list, with an overall median listing price of $1,635,000; properties are still available for purchase at or below the $500k mark.

  • Potential Rental Income: $2,014
  • Property tax rate: 0.55%

San Francisco is also one of the best places to buy a house in California because of its amenities, such as a swimming pool or high ceilings, infrastructure, and the job market.

Midwest Cities

The Midwest is home to many great cities for buyers looking for a property deal under $500K. From Chicago and Detroit to Cincinnati and Indianapolis – the Midwest offers plenty of options for those looking to purchase an affordable house.

But first, we shall see the top 4 cities in the Midwest to buy homes under $500K.

5. Chicago, Illinois

If you want a great deal, Chicago is a great place to buy a home. With its large population, plenty of houses fit your budget under $500,000. You can get a home with a three-car garage, five bedrooms, three bathrooms, two walk-in closets, hard or wood floors, an in-shower, a wet bar, and built-in shelving.

And with a square foot of around 2,500 to 4,000, you can get an expensive home with plenty of room for everyone. So whether you’re looking for a single-family home or a two-story home with a walk-out basement, Chicago has the perfect home for under $500K.

  • Potential Rental Income: $2,500
  • Property tax rate: 1.55%

You can also connect with a real estate agent or a mortgage lender if you have found your dream house in Chicago. They can assist you through the whole process and help you make wise decisions on your home-buying journey.

All you need to do is connect with us, and home-buying will quickly take care of all for you!

6. Minneapolis, Minnesota

Minneapolis, Minnesota, is one of the best cities in the Midwest for budget-conscious buyers looking for a home or investment property under $500K. The median list price in Minneapolis is around $340k, and the city has seen an average appreciation rate of 92.14% over the past decade.

Modern condo and single-family homes are available in the area, offering great value and modern amenities such as a three-car garage ranging from 2,000 to 5,000 square feet, vaulted ceilings, and a finished basement.

Additionally, Minneapolis is known for its vibrant culture with lots of local attractions, a strong job market, and excellent schools. With so much to offer at an affordable price, Minneapolis is an ideal place to invest in real estate.

  • Potential Rental Income: $1,455
  • Property tax rate: 1.31%

7. Indianapolis, Indiana

Indianapolis, Indiana, is one of the best cities in the Midwest for buyers looking for a home under $500K. The median list price in Indianapolis is around$224,000and has seen an average appreciation rate of 81.56% over the past ten years.

Plenty of properties are available at or below this budget threshold, with room sizes ranging from 1,000 to 3,000 square feet. Many offer stainless steel appliances, office space, a dining area, a walk-in closet, and a hot tub.

With its strong economy, low unemployment rate, and high quality of life, Indianapolis is excellent for buyers to purchase a home and make it an Airbnb. You can get a DSCR loan in just five steps to finance an Airbnb and get started in the Airbnb market.

  • Potential Rental Income: $1,254
  • Property tax rate: 0.75%

8. Kansas City, Missouri

Kansas City, MO, is an excellent place to buy a house under $500K. With family-friendly neighborhoods and plenty of amenities, there are many options available in this price range. In addition, ranch-style homes are great options in the city, which provide excellent value for the money.

These homes usually have three or four bedrooms and are often accompanied by a family room, a hot tub, walk-in closets, a wet bar, and outdoor living spaces. Many of these homes offer plenty of space for entertaining family and friends.

Other popular neighborhoods in the city include Brookside, Hyde Park, and the historic Westside neighborhood. These areas offer a variety of styles, including single-family homes, five bedrooms houses, condos, and townhouses.

Additionally, many settings provide modern amenities, such as hardwood flooring and updated kitchens.

  • Potential Rental Income: $1,006
  • Property tax rate: 1.29%

East Coast Cities

East Coast Cities are a great place to buy a house under $500K due to the area’s high population density. In 2019, more than 140 million people lived in East Coast cities, making it one of the most populous places in the Country.

It means that million-dollars homes are rare and often cost less than they would in a less populated area. So, let’s move and explore the top 4 cities on the East Coast to know what an under 500k home looks like on the East Coast.

9. New York City, New York

Home buyers looking for a home under $500,000 should consider buying in New York City. The city offers plenty of housing options that fit this budget criterion and provide excellent value for money.

Many homes look like a million dollars and have features such as two bathrooms, four bedrooms, granite counters, and hardwood floors. However, buyers can find a home in New York with square feet ranging from 500 to 1500 and a half bathrooms, three bedrooms, a marble bath, and a party room for just a fraction of what they would pay elsewhere.

Plus, some properties have unique features such as an in-ground pool, a covered patio, a game room, and more, making them even more attractive.

  • Potential Rental Income: $1,207
  • Property tax rate: 0.88%

Connect with a real estate agent and get a property now because the median home price will rise in a few months. So now is your chance to buy a house under 500k in New York City.

You can connect with us, and we can get you on board with an agent right away who has expertise working with U.S. citizens and immigrants who journey to buy a forever home in Ney York!

10. Washington DC Metro Area

Washington DC Metro Area is home to some of the most attractive housing options on the market. With a median home price of $708,135, buyers can find homes with an open kitchen and a new bathroom at prices far below $500K.

Moreover, the area boasts a robust job market and a high cost-of-living index, making it an ideal place to invest in real estate.

Additionally, the home appreciation rate is 5.7% which makes the Washington DC Metro Area an excellent long-term investment for home buyers looking for a home under $500K.

The home includes spacious living areas, modern amenities such as an outdoor pool, excellent security systems with a low crime rate, robust infrastructure, and a fair share of the public transportation system. Washington DC Metro Area is ideal for purchasing a home under $500K in the Country.

  • Potential Rental Income: $2,705
  • Property tax rate: 0.56%

11. Raleigh-Durham, North Carolina

Raleigh-Durham, North Carolina, is home to some of the most affordable housing options in the U.S., with a median home price of just under $394,950. In addition, this city offers plenty of attractive home choices for buyers looking for an open floor plan, high ceilings, and modern amenities at prices well below the $500K mark.

Many of the homes in Raleigh-Durham offer an open kitchen with stainless steel appliances, updated bathrooms, home security systems, and spacious living areas ranging from 300 to 2,000 square feet.

The city also boasts low crime rates and a fair share of parks, a fitness center, trails, and public transportation options for residents.

  • Potential Rental Income: $2,036
  • Property taxes rate: 0.95%

12. Boston Metro Area (Cambridge/Somerville, MA)

The Boston Metro Area, home to more than 4 million people, is an excellent place for homebuyers searching for an affordable home. According to the data from U.S. Census Bureau in 2021, homes in the area costing under $500K are rising and account for 33.9%of all home sales in Cambridge/Somerville.

Homebuyers can find many styles, including traditional Cape Cod-style homes and a contemporary open floor plan. In addition, many homebuyers get attracted to the region’s quartz countertops, stainless steel appliances, curb appeal, and modern fixtures.

With an increasing number of affordable home options in this area, it’s no surprise that the Boston Metro Area is one of the best places to buy a home under $500K.

  • Potential Rental Income: $1,711
  • Property taxes rate: 0.68%

More Places in America to Buy a Home Under $500K

US StateCityMedian Home Price
AlabamaBirmingham$238,515
AlaskaJuneau$428,700
ArizonaPhoenix$427,586
ArkansasLittle Rock$221,950
CaliforniaHollywood$454,229
ColoradoColorado Springs$490,000
ConnecticutBridgeport$300,000
DelawareWilmington$381,245
FloridaJacksonville$312,635
GeorgiaAtlanta$398,476
HawaiiHilo$458,116
IdahoBoise$470,000
IllinoisChicago$312,877
IndianaIndianapolis$231,170
IowaDes Moines$193,298
KansasTopeka$164,589
KentuckyLouisville$187,500
LouisianaNew Orleans$305,670
MainePortland$508,049
MarylandOlney$610,701
MassachusettsBoston Metro Area$650,000
MichiganDetroit$257,000
MinnesotaMinneapolis$320,000
MississippiJackson$139,000
MissouriKansas City$246,000
MontanaMissoula$572,465
NebraskaOhana$215,800
NevadaLas Vegas$385,000
New HamshireConcord$616,334
New JerseyAtlantic City$161,000
New MexicoLos Alamos$460,750
New YorkNew York City$745,000
North CarolinaRaleigh-Durham$400,000
North DakotaFargo$285,7171
OhioCincinnati$221,000
OklahomaOklahoma City$200,375
OregonPortland$564,334
PennsylvaniaPhiladelphia$279,900
Rhode IslandProvidence$349,316
South Carolina Charleston $505,000
South DakotaSioux Falls$292,900
TennesseeNashville$455,304
TexasHouston$237,970
UtahSalt Lake City$581,413
VermontWoodstock$580,446
VirginiaCharlottesville$454,300
WashingtonSeattle$929,964
West VirginiaParkersburg$126,238
WisconsinMadison$370,890
WyomingCheyenne$368,811
Data Source: Zillow

Factors to Consider When Searching for a Home in the $500K Range

Finding the right home on a budget can be challenging, but it’s not impossible. There are some factors to consider when searching for a home in this range, such as:

1. Location: The location of your home is crucial because you want to be sure that you’re close to amenities, a fitness center, public transportation, natural light, and other conveniences. Do your research to determine which neighborhoods are the most desirable and have home prices that fit within your budget.

2. Home Size: The home you purchase will depend on how much space you need and want. If you’re looking for a home with a large-sized lot, then consider investing in one or two bedrooms for more area. You might even get a house with seven bedrooms, 3,000 to 6,000 square feet.

3. Property Taxes: Property taxes vary significantly from state to state, so research the property tax rate in your area before making a home purchase. Property taxes can dramatically affect how much home you can afford.

4. Repairs and Upgrades: Considering the cost of repairs and upgrades before buying a home is essential. Look into the home’s history to see if any significant issues need to be addressed, or check out the home’s condition to determine what kind of money you’ll need to spend on home improvements.

5. Home Amenities: Finally, consider the home’s amenities. If you’re looking for a home with features like a finished basement, a walk-in closet, a pool, a front porch, bamboo floors, or other luxuries, make sure to factor them into your home budget.

6. Real Estate Agent: A real estate agent is a great resource to have on your side when searching for a home. They can provide insight into the home-buying process and help you find the home that fits your needs. You can also check out the top Real Estate Companies in the USA to find the best one for you.

Considering all these factors and researching home prices in your desired area, you can find the perfect home on a budget of $500K. With careful planning and some creativity, you can find the home of your dreams that fits into your budget. Good luck on your home-buying journey!

Benefits of Purchasing a Home

Now that you know about the housing market, let’s explore the benefits of purchasing a home in depth. Here are two to keep advantages to keep in mind:

1. Financial Benefits: Owning a home can have numerous financial benefits, such as building equity and potential tax advantages. As you pay down your mortgage, the property appreciates (3-5% is the average property appreciation rate), and you can eventually sell it for a profit. And, of course, there’s the benefit of not having to pay rent!

2. Stability: Homeownership offers stability and security, as you will not have to bother about your property being sold or rented out from under you. Your home can also act as a haven during times of economic uncertainty.

These are just some benefits of purchasing a home. With careful research and strategic preparation, you can find the perfect property deal under $500k in your desired area. Start your search today!

Conclusion

In conclusion, homebuyers can find plenty of attractive home options under the $500K mark in cities throughout the U.S. Whether looking for a ranch-style home or a travertine floors plans, and they can find a home that meets their needs and budget.

From Washington DC Metro Area to the Boston Metro Area in the Country, buyers have access to many home styles and amenities that can help them save money when purchasing their dream home.

No matter what your home-buying needs are, there is sure to be an affordable home waiting for you in one of these great cities!

Frequently asked questions

How can I buy a $500k house?

Buying a home for under $500K can be done by researching the home market in populated cities and looking for properties with attractive home features and amenities. Additionally, it is crucial to consider home appreciation rates in the area and the cost of living when making a purchase.

Finally, homebuyers can take advantage of home buyer grants and other incentives to help cover closing costs and additional associated fees.

Homebuyers can also connect with HomeAbroad Certified International Property Specialists (CIPS) agents that have mastery in international business and trading with global real estate trades.

Where is the cheapest place to buy a house in the United States?

It depends on homebuyers’ budgets and individual needs. Generally, cities such as Raleigh-Durham, NC, Washington DC Metro Area, and the Boston Metro Area offer homebuyers a wide range of home styles and amenities at budget-friendly prices.

How much does a $500,000 house cost per month?

Homebuyers can expect to pay on a home that costs $500,000 depending on their down payment and the home loan’s interest rate.

How much deposit do I need for a 500k property?

You can expect a 20% or more down payment on a home that costs $500K.

Where should I buy a house for investment?

By researching home markets in populous cities and looking for properties with home features that will have a high return on investment (ROI). Additionally, homebuyers should consider home appreciation rates in the area, the cost of living, and homebuyer grants or other incentives when making a purchase.

What to look for when buying a house in the U.S.?

When buying a home in the U.S., homebuyers should consider factors such as home appreciation rates, style and amenities, cost of living in the area, home buyer grants or other incentives, and home security systems.

Additionally, homebuyers should inspect for structural issues or potential damage and consider the home’s proximity to local attractions and amenities. Lastly, homebuyers should research the home market in populous cities to find the best home deals.

How do I qualify for a $400k house?

If you live in the home, your choice will determine how much home you can afford. Generally, a home buyer should spend about 2.5 times their annual gross income to qualify for a home loan at $400k.

For example, if your annual income is $80k, you would need to demonstrate that you have adequate funds for a home of approximately 2,000 square feet or a home that costs about $400k.

Which states have the most perfect and cheapest houses?

It depends on homebuyers’ individual needs and the home features they desire. However, states such as West Virginia, Washington DC Metro Area, North Dakota, Salt Lake City, and the Boston Metro Area offer homebuyers a wide range of home styles and amenities at budget-friendly prices.

How much should I make to buy a 500k house?

The answer depends on the homebuyers’ financial situation. Generally, homebuyers should have a good credit score and a steady income to secure a home loan. Additionally, homebuyers should also account for home taxes and insurance costs when determining how much money they need to buy a home.

About the author:
Michele Lawrie, a seasoned real estate professional licensed in New York and Florida, serves as the Chief Real Estate Officer at HomeAbroad. With over 15 years of experience and specialized certifications from the NAR (National Association of Realtors), Michele is a trusted expert for foreign nationals buying US real estate.

"Unlocking US real estate for the world with our tailored offerings."

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