St Louis has been named the top destination for Americans looking for their first home.
Missouri City is the best market this year for first-time buyers – from tHeirs’ dollars will go further and there will be greater availability of affordable housing.
Of the ten main markets named in the New analysis of the home sales site. Zillowhalf are in the Midwest, including Detroit, Minneapolis, Indianapolis and Kansas City.
First-time buyers accounted for half of all homebuyers last year, according to Zillow, the highest share since at least 2017.
Last year’s high mortgage rates meant many homeowners were incentivized to stay because of the low rate on their current mortgage, keeping some potential repeat buyers on the sidelines.
St Louis has been named the top destination for Americans looking for their first home.
Along with Midwestern cities, Austin, Pittsburgh, San Antonio, Birmingham and Baltimore also make the list of top markets for people looking to get into real estate.
Zillow ranked the best markets for first-time buyers based on rental affordability, the proportion of listings a typical household can comfortably afford, how tough competition is expected to be for those affordable properties, and how many older households similar people live in the area.
The study looked at rental affordability as a way to judge how easy it would be for potential buyers to build up savings for a down payment.
Unlike some similar studies, Zillow did not look at average salaries in the area as a basis for affordability in certain markets.
The top two markets in Zillow’s rankings (St Louis and Detroit) performed well in terms of affordability, both in terms of rent and the number of affordable homes available for purchase.
Meanwhile, Austin, while not the most affordable market on the list, ranks first for the number of households of similar ages living there, with which a buyer could build a community.
Austin home prices have skyrocketed during the pandemic, as its sunny weather, expansive state parks and relative affordability attracted an influx of buyers.
The Texas city once was seen as the epitome of the Sunbelt’s booming real estate market, but home prices are now falling.
Detroit ranked second on Zillow’s list, scoring well for rental affordability and a variety of affordable homes available for sale.
Minneapolis was ranked third by Zillow in its analysis of the best markets for first-time buyers this year.
“Getting a home is a difficult hill to climb, and it’s especially steep for first-time homebuyers,” said Orphe Divounguy, chief economist at Zillow.
‘Headwinds such as mortgage rates, low inventory and rising rents remain strong, but are easing.
“Getting a home is a difficult hill to climb, and it’s especially steep for first-time homebuyers,” said Zillow Chief Economist Orphe Divounguy.
‘The increase in new listings this spring, due to both new construction and more homeowners choosing to sell, will give buyers more choice and help alleviate price growth.
“The real estate bandwagon is slowing enough to give more first-time buyers a chance to jump on it,” he added.
First-time buyers should be aware of financial obstacles, including how their credit score can affect their borrowing options and costs, and how much they should save for a down payment.
While a typical down payment tends to be 20 percent, Zillow notes that those who haven’t saved enough shouldn’t think this excludes them from purchasing their first home.
Separate analysis of the real estate market shows that almost half of buyers last year put down less than 20 percent.
While housing sales and inventory increased in February, according to the National Association of Realtors, high mortgage rates and property prices mean many Americans still face affordability challenges.
According to the latest data from government-backed lender Freddie Mac, the average 30-year fixed mortgage is around 6.82 percent.
Last year, the housing market gained a whopping $2 trillion in value, amid a historic shortage of homes for sale.
And over the past two years, the housing market has gained $5.6 trillion, according to Redfin, leaving many Americans out of the market.
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