SEATTLE, March 19, 2019 /PRNewswire/ -- First-time
buyers looking for an affordable home without steep competition
will have the best luck in Tampa,
Florida, according to Zillow®'s 2019 Best Markets for
First-Time Buyers Analysis. This is the second year in a row that
Tampa tops this list.
Zillow ranked the 35 largest U.S. housing markets based on where
first-time buyers should have the most success moving into a home
they love with a strong forecasted appreciation. First-time buyers
make up 46 percent of all buyers, and more than 6 in 10 of them are
Millennialsi.
The U.S. housing market has cooled recently and inventory is up
1 percent year-over-year, after being down 8.7 percent last year.
It's the first time inventory has been up heading into
home-shopping season in at least five years. In even more welcome
news for first-time buyers, inventory of less-expensive starter
homes has turned around far more – up 4.1 percent after being down
12.9 percent last year. Even with this change, there still are not
enough homes for sale to meet buyer demand, and the market remains
competitive.
"The shortage of starter homes across the country is finally
starting to ease, and that's good news for would-be first-time
buyers who have been saving up to make the leap into
homeownership," said Skylar Olsen,
Zillow's director of economic research. "Unfortunately, prices of
homes in the lower third of the market have risen so much in recent
years that for many households' budgets they no longer qualify as
affordable. But markets like Tampa
and Las Vegas still provide plenty
of bargains."
First-time buyers are naturally disadvantaged compared with
other buyers, because they don't have capital from a previous home
sale to help fund a down payment or keep up with bidding wars. And
younger first-time buyers have had less time to save for a down
payment than most repeat buyers. Millennialsii go into
the process knowing that, and help mitigate those difficulties by
working harder than previous generations of home buyers – they take
more home tours, attend more open houses, do more research about
which homes to look at and contact more agentsiii.
Younger buyers are more likely to go over their budgets to nab
their first home. But those buying in the top markets in Zillow's
First-Time Buyers Analysis should have a better chance of staying
within budget to buy a home they love, as market trends show they
are more likely to require smaller down payments and to have had
prices cut.
Ten Best Markets for First-Time Homebuyers
- Tampa, FL
- Las Vegas, NV
- Phoenix, AZ
- Atlanta, GA
- Orlando, FL
- Miami, FL
- Detroit, MI
- Dallas, TX
- Nashville, TN
- Charlotte, NC
Ten Most Challenging Markets for First-Time
Homebuyers
- San Francisco, CA
- Seattle, WA
- Washington, D.C.
- Los Angeles, CA
- Sacramento, CA
- Minneapolis, MN
- Denver, CO
- San Diego, CA
- San Jose, CA
- Boston, MA
Zillow's list of the best markets for first-time buyers is based
on four metrics:
- Low median home value that requires a smaller down payment
- Strong forecasted home value appreciation, helping buyers'
overall wealth grow
- High inventory-to-household ratio, to indicate available
supply
- High share of listings with a price cut
To help home shoppers better understand all the costs associated
with homeownership, RealEstate.com, a Zillow Group brand tailored
to first-time home buyers, calculates an "All-In Monthly Price" for
every home and breaks out estimated expenses that might roll up
into a monthly payment, including principal and interest, property
taxes, homeowner's insurance, HOA fees and utilities, and closing
costs.
Zillow
Zillow is the leading real estate and rental
marketplace dedicated to empowering consumers with data,
inspiration and knowledge around the place they call home, and
connecting them with the best local professionals who can help. In
addition, Zillow operates an industry-leading economics and
analytics bureau led by Zillow's Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of
economists and data analysts produce extensive housing data and
research covering more than 450 markets at Zillow Real Estate
Research. Zillow also sponsors the quarterly Zillow Home Price
Expectations Survey, which asks more than 100 leading economists,
real estate experts and investment and market strategists to
predict the path of the Zillow Home Value Index over the next five
years. Launched in 2006, Zillow is owned and operated by Zillow
Group, Inc. (NASDAQ:Z and ZG), and headquartered in Seattle.
Zillow is a registered trademark of Zillow, Inc.
i Data from the 2018 Zillow Group Report on Consumer
Housing Trends.
ii Millennials refers to people between the ages of 24
and 38.
iii Data from the 2018 Zillow Group Report on Consumer
Housing Trends.
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SOURCE Zillow