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A Michigan man has revealed how giving up his car in favor of relying on public transport enabled him to save up enough money to buy his first home.
While many Americans believe that the dream of homeownership might be out of reach, Ken Miguel-Cipriano achieved that goal with a simple lifestyle change.
Instead of sinking hundreds of dollars into a car payment every month, Miguel-Cipriano decided to save that money and put it toward a down payment. Giving up his car was a relatively easy decision to make, he told Fox 17.
“I’ve been taking public transit all my life,” he told the network. “I was never ashamed to take the bus, never ashamed to walk, never ashamed to be on the bike.”
His commitment to car-free living paid off, and he was able to save enough for a down payment on a multilevel home on the south side of Grand Rapids, MI.
Miguel-Cipriano’s story highlights a lesser-discussed facet of an oft talked-about crisis: how transportation costs affect housing affordability. Can other hopeful homebuyers ditch their cars to save enough to buy a home? We break down the numbers.
(Fox 17)
How taking mass transit adds up
Miguel-Cipriano’s experience isn’t unique. Across the country, the high cost of car ownership is forcing many people to rethink their transportation choices—especially as home prices continue to climb. So how much can skipping a car actually save you?
The cost of car ownership goes far beyond a monthly payment. It’s a bundle of expenses and responsibilities that can drain thousands of dollars a year from a household budget.
For the average driver, owning a car can cost between $858 to $1,153 per month when factoring in the following:
- Loan payment: $520 to $737 per month
- Insurance: $80 to $158 per month
- Fuel: $208 per month
- Maintenance: $50 per month
That amounts to between $10,296 and $13,836 per year just to keep a car on the road.
In contrast, monthly unlimited transit passes cost significantly less.
- Grand Rapids: $47 per month
- Boston: $90 per month
- Philadelphia: $96 per month
- New York City: $132 per month
That means a transit rider can expect to spend between $564 to $1,584 per year, depending on the city—or a fraction of what car owners pay.
From car payments to homeownership
By forgoing a car and relying on public transit, the average person could save between $8,712 and $13,727 per year. For someone saving at the high end of this range, a 20% down payment on a median-priced home in the U.S. ($83,840) could be within reach in just six years—about the same time it takes to pay off a car loan.
Unfortunately, though, this isn’t a feasible trade-off for most. A shocking 70% of public-transit commuters reside in seven cities in the U.S., according to the U.S. Census Bureau, largely because these cities are the only places where one can reliably depend on mass transit for all their transportation needs.
(Fox 17)
Cost of living near public transit
Saving on transportation can be a game changer for homebuyers, but public transit has its own hidden expense.
In cities with robust transit networks, rent and home prices are often higher than the national median and homes near transit stops come at a premium. This means that while residents save on car-related expenses, much of those savings are reabsorbed into higher rent or mortgage payments.
This creates a double bind for many prospective homebuyers. Those who move to transit-rich areas may struggle with rising home prices, while those who opt for more affordable housing outside of these metropolitan centers face longer commutes and higher transportation costs.
Is your commute affecting your housing costs?
Ultimately, the true cost of homeownership isn’t just about mortgage payments—it’s also about where you live and how you get around.
Traditional measures of housing affordability often consider housing costs alone, typically suggesting that housing is affordable if it consumes no more than 30% of household income. But this metric overlooks transportation expenses, which can vary widely depending on location.
The Center for Neighborhood Technology developed the Housing + Transportation Affordability Index to provide a more comprehensive view. The index considers both housing and transportation costs at the neighborhood level, revealing that while 55% of U.S. neighborhoods are considered affordable when only housing costs are considered, only 26% are affordable when transportation costs are included.
How cities are addressing affordability through transit solutions
Some cities, like Austin, TX, are making mass transit a central part of their response to housing affordability through transit-oriented development.
“You can’t have real affordability without having good transportation options,” Austin Mayor Kirk Watson said during the Realtor.com® Let America Build panel at SXSW.
The city has prioritized compact, walkable housing developments by reducing minimum residential lot requirements and fast-tracking zoning for housing on Austin’s mass transit line, CapMetro.
But this progress could be in crisis after mixed messages from the Trump administration, Watson warned.
“If you have a federal government that is anti-transit, that means, to some degree, they’re going to be anti-affordability,” he said. “The money that the federal government can put into play has to be there.”
Still, progress is being made. The median rent in Austin slid nearly 4.8% compared with a year ago thanks in large part to the housing supply the city was able to fast-track.
Miguel-Cipriano’s story underlines the impact that integrated mass transit and housing affordability strategies like this can have.
But as federal support for transit wavers, the question remains: Will more cities invest in solutions that make car-free living a realistic option, or will home affordability continue to depend on the burden of car ownership?