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Real Estate Settlement: Impact for buyers & sellers
Real estate developer Uri Man shares insight to how this settlement is shaking up the entire housing market
SEATTLE - If you’re looking to purchase your first home, you may want to consider one of these housing markets.
A new analysis by Zillow has revealed this year’s best markets for first-time home buyers – with half of the top markets residing in the Midwest.
Zillow’s rankings were based on rent affordability, the share of for-sale listings a typical household can comfortably afford, how stiff the competition is expected to be for those affordable listings, and how many similar-age households live in the area.
"Affording a home is a tough hill to climb, and it’s especially steep for those buying their first home. Headwinds like mortgage rates, low inventory and rising rents are still strong, but easing," said Zillow's Senior Economist Orphe Divounguy.
St. Louis, Detroit are top housing markets for first-time home buyers
The top two markets in Zillow’s ranking, St. Louis and Detroit, scored well in terms of affordability — both for rental affordability as a prospective buyer builds up savings for a down payment, and for the number of affordable homes available to buy.
For Sale sign seen outside a house. (Credit: Artur Widak/NurPhoto via Getty Images)
Austin, while not the most affordable housing market on this list, ranked first in the number of similar-age households living there with which a buyer can build a community.
Top 10 markets for first-time home buyers in 2024
- St. Louis
- Detroit
- Minneapolis
- Indianapolis
- Austin
- Pittsburgh
- San Antonio
- Birmingham
- Kansas City
- Baltimore
In 2023, first-time home buyers accounted for half of all home purchases, according to Zillow’s Consumer Housing Trends Report.
"That’s the highest share in the report’s history, which dates back to 2018, and up from a low of 37% in 2021," Zillow wrote.
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The "rate lock" effect, which occurs when homeowners are financially incentivized to keep their current home because of the low rate on their current mortgage, has kept some would-be repeat buyers on the sidelines.
"Attractive homes are moving fast, so those looking to buy this spring should get their finances in order now, including getting pre-approved for a home loan," Zillow continued. "The increase in new listings this spring, due both to new construction and to more homeowners choosing to sell, will give buyers more options and help to ease price growth. The housing train is slowing down just enough to give more first-time buyers an opportunity to hop on board."
This story was reported from Los Angeles.