Could a Side Hustle Be Your Ticket to Homeownership?

Boosting your income could make it easier to buy a home.

Buying a home is no easy feat. These days, a lot of mortgage lenders will allow you to put down less than 20% of a property's purchase price at closing. But often, you'll still need to come up with a 10% down payment. In today's housing market, that's a tougher thing to do compared to just a couple years ago.

Over the past year, home values have soared on a national level. As of this summer, home values were up almost 20% compared to a year prior. That means you'll need a higher down payment to buy a home right now, and you may only be able to squeeze so much savings out of your paycheck. If that's the case, a second job could be just the thing that helps you make your dream of homeownership a reality.

How can a side hustle help you buy a home?

Some people pick up side hustles to drum up extra cash for leisure, vacations, and fun purchases. A side hustle could also help you meet a major financial goal like buying a home.

The more money you're able to earn, the easier it will be to come up with a high enough down payment for the type of home you want. Also, one factor mortgage lenders look at when approving candidates is their income. If you're able to boost yours with a side job, that extra income will count toward the total amount your lender takes into account.

Which side hustle is right for you?

Getting a side job on top of your main one could help you save up a down payment sooner. But finding the right side gig is key.

There are different factors you should look at when assessing your choices.

• Earnings potential: How much money can you possibly make from your side job, and do you have the option to work as many hours as you'd like to eke out more cash?
• Flexibility: Can you work your side hustle at your own pace, or will you have to commit to preset hours?
• Career growth: The right side hustle could help you build or boost skills that make you better at your main job, which could lead to a promotion or raise.
• Conflicts of interest: Your full-time employer could take issue with you getting a side hustle in the field you already work in, especially if that second gig has you doing assignments for a competitor.

Once you've landed on a side gig, map out some income goals so you know what you're aiming for. If you're about $10,000 shy of the down payment you're hoping to make and you're able to save $1,000 a month from your primary salary, earning $1,000 a month from your side hustle would mean meeting your goal in five months' time.

It never hurts to boost your income

Even if you're pretty close to having a down payment to buy a home, once you purchase a place of your own, the bills might start rolling in. You may have projects you want to tackle or repairs you don't want to put off. The more money you have access to, the better, so it pays to consider getting a side hustle, even if it's just on a temporary basis.