The plight of first-time homebuyers cut off from the path to homeownership by high home prices and high interest rates is well known. However, 10 cities, primarily in the Mid-Atlantic and Florida, offer opportunities to take that first step because they are affordable, have listing prices below the national median, healthy economies, and many of the amenities young families desire.
A new report by Realtor.com on the 10 best markets for first-time homebuyers in 2025 offers hope. It follows a disastrous year in 2024, which saw historically low activity by this group, which the report said accounted for only 24% of successful homebuyers. This year is expected to be better as more houses come onto the market, even though purchasers will likely have to make trade-offs in their dream requirements to strike a deal.
Heading the list of the best markets is Harrisburg, PA, where the median listing price in November 2024 was $140,000, one in five homeowners was between 25 and 34, and 35 houses were available per 1,000 households. Other locations in the top 10 were Rochester, NY, Villas, FL, Lauderdale Lakes, FL, Altamonte Springs, FL, Lansing, MI, North Little Rock, AR, Baltimore, MD, Tonawanda, NY, and Wilmington, DE.
The lowest supply per 1,000 households was in Harrisburg, and the highest in Villas, Lauderdale Lakes, and Baltimore. Listing prices ranged from a high of $236,959 in Villas to a low of $129,900 in Rochester. The home price-to-income ratio varied from 4.1 in Wilmington to 2.5 in Rochester. The longest travel time to work was 32 minutes in Baltimore and Lauderdale Lakes and the shortest was 21 minutes in Rochester and Lansing. Each city was close to a major job hub, whether a state capitol, academic institutions and hospitals, or a major city like Philadelphia.
In addition, each of the 10 markets was expected to offer a good return on investment, with price growth above the national rate of 3.7%. The greatest gains would be in the Florida cities of Altamonte Springs (12.1%), Villas (9.6%) and Lauderdale Lakes (9%).
“The places highlighted offer opportunities for first-timers in terms of the cost of housing, availability of homes for sale, and quality of the location,” noted chief economist Danielle Hale. “Choosing the best place will come down to what’s most important to each buyer and their family.”
Markets that made it to the list offered features like affordable listings, strong local economies, lively places for families to enjoy, and opportunities for a return on investment. Each was considered affordable because a house would cost less than 30% of the buyer’s income, and the median income in each place was less than the national median of $416,880.