Home prices hit a new record high — these 3 strategies can help you save

Unfortunately, homebuyers looking for a deal this summer are getting more bad news: Prices just hit an all-time high. 

The median home price reached $408,776 in June, according to a Redfin report published on July 13. That's a 2.2% increase from the year prior and 51.4% increase from the highest price in 2019, before the pandemic dramatically affected home prices. 

The uptick is largely due to an increased demand. Despite mortgage rates remaining in the mid-6% range for months this year, home sales were at their highest level last month since the tail end of the pandemic-era housing boom in 2022, per Redfin. 

Not all demand is up equally — wealthy homebuyers in the Bay Area and South Florida helped push home prices and sales up, according to Redfin. 

If you're looking to buy a property, there are still strategies you can use to make homeownership more affordable. Below, CNBC Select outlines the three steps you can take right now. 

Your mortgage rate can significantly affect how much house you can afford. The higher the rate, the higher your monthly payment and the more you'll pay over the life of the loan.

You can save on your rate by choosing the right lender. To do this, be sure to get quotes from three to five lenders so you can compare and choose the best one for you. After all, certain lenders are known for offering lower-than-average rates. 

At Select, we like Better for this reason. It offers rates that are typically well below the national average. For example, on July 13, its rate on a 30-year fixed-rate home loan was 6.12%, according to its website. That's lower than the national average of 6.64% for that date, per Mortgage News Daily. 

We also recommend getting a quote from a credit union as a mortgage lender. Credit unions are member-owned, so everything they make goes back into products for their members, which is why these institutions tend to have lower rates than for-profit lenders. 

While many credit unions restrict membership based on location, job, or other affiliation, some require very little. We like FourLeaf Credit Union because you can become a member with a $5 deposit into one of its accounts. 

FourLeaf also consistently offers rates below the average. For example, on July 13, its rate on a 30-year fixed-rate home loan was 6.50%, assuming a New York property, the state where FourLeaf is based. 

Next, check whether you meet the eligibility requirements for government-backed loans such as VA, FHA and USDA loans. These loans offer rates lower than those of conventional mortgages.

FHA loans are available to Americans with a 580 credit score, a 3.5% down payment and a debt-to-income ratio of 43% or lower. 

Rocket Mortgage, one of the largest FHA lenders in the country, appears on many of our best mortgage lists. That's because it has a strong record of customer service — it consistently ranks at the top of J.D. Power customer satisfaction surveys and has an A+ rating from the Better Business Bureau. Additionally, it offers an easy-to-use website and a wide range of tools to help homeowners. 

VA and USDA loans are more exclusive — with both, you can put as little as 0% down. To be eligible for a VA loan, you must have served in the military, and to get a USDA loan, you must be buying an eligible property in specific rural and suburban ZIP codes. 

If you are looking for a VA loan, consider applying to Navy Federal Credit Union. This lender often offers some of the lowest VA loan rates. 

If you think a USDA loan may be right for you, consider Guild Mortgage. Guild will accept applicants with credit scores as low as 540, whereas many lenders require a credit score of 620 or higher. 

Finally, starting with a higher credit score when applying for a mortgage can save you a lot of money. 

A conventional mortgage borrower with a credit score of 780 or higher had a 30-year fixed rate of 6.51%, compared to 7.41% for a borrower with a credit score of 620, per Experian data. 

While achieving excellent credit means keeping credit utilization low and paying down debt on time, you can go further and enhance your score with *Experian Boost — a free service that reports bills you've paid on time, such as rent and utilities, which are typically not included on a credit report.

Why trust CNBC Select?

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed financial decisions. Every mortgage article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of the products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.

Catch up on Select's in-depth coverage of personal finance, tech and tools, wellness and more, and follow us on Facebook, Instagram and Twitter to stay up to date.