The upswing in mortgage rates during the final two years of the decade has kept first-time homebuyers at bay. They are scared away by high housing costs, which have gotten worse since the pandemic. As long as you know where to look, it’s possible to become a first-time homebuyer in 2023.
Zillow ranked U.S. metros based on these factors: mortgage and rent affordability for first-time home buyers, the availability of homes for sale, and the share of listings with a price cut. In 2023, affordability will be key for first-time buyers — so it’s more important than ever to plan ahead.
Zillow ranked cities based on factors such as mortgage and rent affordability, available homes for sale, and the share of homes with a price cut. The top 10 friendliest cities for first-time buyers are:
Wichita, Kansas
Residents of the Kansas metro spend 27 percent of their income on rent and 32 percent on their mortgage, giving them more buying power. The metro also has a higher share of listings relative to active shoppers, with an estimated buyer-to-listing ratio of 22 to 1.
Toledo, Ohio
If you’re a first-time home buyer, you might consider Toledo. According to data from Zillow, Toledo residents spend about 29 percent of their incomes on rent — below the average of 44 percent for the United States — and 26 percent of their incomes on mortgage costs. The median home value in Toledo is $172,710, with 23 percent of listings having had their price cut since they were originally listed.
Syracuse, New York
If you plan to live in the state of New York, consider Rochester as your next housing destination. Residents in Rochester spend an average of 36 percent of their income on rent costs and 30 percent on mortgage costs. The typical home is valued at $204,890 — well below the national average of $358,423 and 19 percent take a price cut, with the ratio of buyers to listings at 4 to 1.
Akron, Ohio
The city of Elyria, located east of Cleveland, has a typical home value of $211,069. Residents there typically pay 25 percent of their income on rent and 28 percent on mortgage payments. Twenty-nine percent of homes listed for sale have a price cut, and the estimated inventory-to-buyer ratio is 5 to 1, according to Zillow.
Cleveland, Ohio
Cleveland is a popular place to live for its affordability and job opportunities. Residents spend about 30 percent of their income on rent and an average of 31 percent on mortgage payments, which go toward the typical home valued at $218,775. According to Zillow, twenty-seven percent of homes for sale in the city take a price cut, and there’s a buyer-to-inventory ratio of 5 to 1.
Renting a home in Tulsa for the average cost of $846 per month means residents spend 31 percent of their income on housing costs. This is the same amount they spend on mortgage payments, on average.
Detroit, Michigan
The Motor City is a bargain for home buyers with a median sales price of $239,846 and an average of 31 percent of income spent on both rental costs and mortgage costs.
Pittsburgh, Pennsylvania
Pittsburgh residents spend about 33 percent of their income on rent and 30 percent of their income on mortgage payments. More than one-fourth of homes in the area take a price cut, and there are six buyers for every available house (according to Zillow).
St. Louis, Missouri
In St. Louis, 33 percent of the average resident’s income goes to rent and 30 percent goes to a mortgage, according to Zillow. The typical home costs $246,369 and 25 percent of homes take price cuts while there is a 4 to 1 ratio of buyers to sellers on the market.
Little Rock, Arkansas
Little Rock residents spend 30 percent of their income on rent every year, while 32 percent goes towards mortgage payments. It’s slightly more expensive to own than to rent, but in Little Rock, there’s a 6-to-1 ratio of inventory to buyers. That means if you’re ready to buy now, you’ll have plenty of options!
Which city are you eyeing this 2023? Let us know by commenting below!
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