Providence Ranks Low For First-Time Homebuyers

PROVIDENCE, RI — Anyone looking to buy a house for the first time quickly realizes how expensive the entire process is, from deposits to inspections to renovations. Across the country, home values vary widely by city, making some states a better choice for first-time homebuyers than others. Providence, Rhode Island, was ranked near the bottom of the list by personal finance site WalletHub.

Out of 300 cities ranked in WalletHub's best and worst cities for first-time homebuyers, Providence ranks 206, awarded just 49.66 points out of a possible 100.

First-time home buyers are a considerable chunk of the real estate market. According to WalletHub, 39 percent of all homes purchased in the fourth quarter of 2019 were from this category. To determine the ranking, the company weighed 26 indicators to help determine how attractive the market is, how affordable homes are and quality of life in the city.

In first place is Henderson, Nevada, followed by Boise Idaho and Thornton, Colorado. California sweeps the end of the list, with Santa Barbara, San Francisco and Berkeley in the final three places.

Here's how Providence ranks in each category:

• Overall: 206
• Points: 49.66
• Affordability: 212
• Real estate market: 193
• Quality of life: 144

According to Realtor.com, the median home price in Providence was $270,000, a 3.9 percent year-over-year increase. The median salary, meanwhile, is $66,000, according to PayScale.com. While the monthly mortgage payment may seem affordable on its own, Jen Cooke, a lecturer at the center for real estate at the Massachusetts Institute of Technology, said it's important for first-time buyers to consider other, unexpected costs.

"Take the time to understand the costs associated with homeownership," Cooke recommended. "Many people do not think about the costs of operating and maintaining a home. I would also recommend that you do a 'what if' financial exercise. If you or a spouse lose a job? What cushion do you have? How could you continue making your loan payments?"

See the full ranking on WalletHub's website.