As if that weren’t enough weighing on an already-important decision, there are also housing markets to consider. Thankfully, a new Zillow report published on April 4 ranked the top 10 markets for first-time home buyers based on four metrics.
To find the top 10 markets for first-time home buyers, Zillow looked at rent affordability (defined as the share of median household income spent on rent); the ratio of affordable for-sale inventory to renter households (more inventory per renter, for the purposes of this report, was an indicator of less competition in each listing); the share of households aged 29-43 (more households with a similar age, according to Zillow, meant a higher score in this category); and the share of availability inventory found on Zillow that the median household could comfortably afford (which Zillow defined as spending “no more than 30% of income on an estimated monthly mortgage cost”).
Based on the data that Zillow gathered, the most affordable market for first-time buyers is St. Louis, Missouri. Affordable listings currently comprise 67% of affordable listings as a percentage of total for-sale inventory, and the average household spends 20% of their median household income on rent — well under the 30% that financial experts recommend the average person budget for housing costs.
Detroit, Michigan, placed in Zillow’s report, with affordable listings making up 64% of the city’s inventory. Meanwhile, home-buying-aged households between the ages of 29 and 43 make up 24% of the city’s total households.
Third place went to Minneapolis, Minnesota, with Indianapolis, Indiana, following closely behind in fourth place.
You can check out Zillow’s full report for yourself here.
