Say goodbye to the starter home In Danville, CA
As millions of Americans go in search of their first home this spring, many may find that the starter homes they once envisioned now have long-term home prices. Now what?
The homebuyers bearing the brunt of America’s historic shortage of property is the first-timer. With no existing home to sell for equity, they’re faced with an ongoing shortage of starter homes, those smaller, relatively inexpensive properties where young homebuyers typically live for a few years before upgrading. And those that remain are being snatched up in a matter of days, often by deep-pocketed investors who intend to rent them out or renovate and flip them.
Price increases have already affected the demographics of first-time homebuyers over the past few decades. While the first-time buyer’s median age was 32 in 1981, it’s now 45, according to the National Association of Realtors. Meanwhile, the median income for first-time buyers increased from $80,000 a year in 2020 to over $86,000 in 2021.
As the spring homebuying season gets underway, the state of the market has forced some first-time buyers to completely reimagine what their first home looks like, or consider whether they will have to continue renting in lieu of being able to afford to purchase a home.
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