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How to buy a luxurious house without breaking the bank

As statistics make obvious, the rich are getting richer. So, too, are the homes of the well-paid getting richer with amenities. That’s according to the National Association of Home Builders (www.nahb.org).

But these swanker homes also require a higher income than in the past. In the current era of stringent mortgage lending standards, the median income required to buy a new home in America has ascended from $91,768 in 2005 to $107,607 in 2011.

“The lion’s share of income gains has gone to the top. At the same time, people in the middle are spending much more for housing,” says Robert H. Frank, a Cornell University economics professor and co-author of “The Winner-Take-All Society.”

James W. Hughes, a housing expert and dean at Rutgers University, urges you to look beyond your monthly mortgage payments when determining if you can afford a given property. “With rising property taxes and costs for home improvement services, you have to be concerned about the operating costs for a large space,” Hughes says.

To get a spacious and well-appointed home, some home-buying families are still willing to move to an outer-tier suburb where prices are lower on a per-square-foot basis. Yet, at the same time, an increasing number of buyers now have a strong preference for a home located near their job or one located in a “walkable urban center,” says Christopher B. Leinberger, chair of George Washington University’s Center for Real Estate and Urban Analysis.

Leinberger talks about a long-term transformation that he projects will favor housing units which are conveniently located, while weakening relative values in more remote communities.

Are you determined to avoid becoming “house poor” but would you like to buy as large a home as possible in a relatively close-in area? These pointers could prove useful:

• Assess the indirect commuting costs of any home you’d like to buy. He encourages homebuyers from a dual-income household to look for a property from which at least one spouse could walk to work or commute by public transit. That way, the household could reduce to a single vehicle.

• Factor in utility costs. Hughes strongly recommends that those shopping for a property look for energy-saving features, including double- or triple- pane windows and extra insulation. Hughes recommends that anyone buying a resale property ask the owner for two to three years’ worth of utility bills.

• Consider upkeep expenses. Those who buy a brand-new house from a builder with high construction standards can typically expect relatively low repair and appliance-replacement costs for five to 10 years. But chances are, you'll be less fortunate if you choose an older home, which could be especially pricey to maintain if it’s large.

• Examine the trend for homeowner association fees. At a gated community in the suburbs or a condominium building in a city, the odds are you’ll be subject to a monthly fee to cover maintenance, security and other expenses.