Many first-time buyers find it difficult to get a higher price. The National Association of Realtors® reported that the median price of existing homes in September rose to $352,800, up 13% year over year.
Repeat buyers usually use the equity in their current home for a down payment on their next home. “But first-time buyers don’t have that luxury,” Danielle Hale, realtor.com®’s chief economist, told Forbes.com.
In September, first-time home buyers comprised 28% of home sales, down from 31% a year ago. “A number of potential buyers have merely paused their search, but their desire and need for a home remain,” says Lawrence Yun, NAR’s chief economist.
Affordability challenges are prompting many millennials—the majority of whom are first-time homebuyers—to move outside of cities to the suburbs or even the exurbs. Forbes Advisor identified the top markets for first-time homebuyers by looking at where cities’ average wages are enough to afford a median-priced single-family home; the most affordable markets for remote workers; and the most affordable cities for condo buyers.
In the top 10 most affordable cities for those earning the average wage, the median sales price of a single-family home was under $200,000. The following are the five cities that topped Forbes Advisor’s list as most affordable places for average-wage earners:
1. Macon, Ga.
Median sales price (Q3 2021): $104,750
Annual income needed to buy a home: $19,471
2. Peoria, Ill.
Median sales price (Q3 2021): $124,950
Annual income needed to buy a home: $28,749
3. Detroit-Warren-Dearborn, Mich.
Median sales price (Q3 2021): $155,000
Annual income needed to buy a home: $30,949
4. Augusta, Ga.
Median sales price (Q3 2021): $132,000
Annual income needed to buy a home: $23,568
5. Charleston, W.Va.
Median sales price (Q3 2021): $138,500
Annual income needed to buy a home: $24,274
The most affordable cities for condo buyers, according to Forbes Advisor, are:
1. Tulsa, Okla.
The median price for condos, townhomes, rowhomes, and co-ops (August 2021): $81,500
2. Wichita, Kan.
Median price: $103,000
3. Hartford, Conn.
Median price: $103,950
4. Harrisburg, Pa.
Median price: $108,500
5. Columbia, S.C.
Median price: $119,700
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