For first-time home buyers in America, prospects are becoming increasingly slim.
Houses that once served as entry points for first-time buyers are becoming harder to find, with competition from house flippers and downsizers, BestMoney said in a Feb. 12 news release.
“While price points and market dynamics vary from one city to another, one thing remains constant — starter homes seem to be disappearing,” BestMoney said.
In California, however, that prospect is even more stark: cities rank among the hardest places to find a starter home and have the most expensive starter homes, according to a recent study by BestMoney.
Study’s methodology
Using data from 5.8 million home-sale records across more than 70 metro areas nationwide, BestMoney created a report showing that starter homes are the most difficult and easiest to find.
“Our analysis focused on sales of houses and townhouses that occurred in the last three years that exist within 30 miles of the center of a major city,” BestMoney said.
BestMoney classified starter homes as those with less than or equal to 80% of the local median sale price, as well as those with a square footage less than or equal to the 25th percentile for the market.
Two California cities among hardest to find starter homes
In the typical housing market, about 17.5% of homes qualify as starter homes, BestMoney said.
In the company’s analysis of 60 cities, however, it found that more than half of them have an even lower percentage of starter homes.
Los Angeles and San Diego made the top-10 list, with starter-home shares of 14.374% and 15.054%, respectively, among places where finding a starter home is the most difficult.
Hawaii topped the list with 12.152% starter homes.
California is ‘the toughest place for shoppers’
Not only is it hard to find a starter home in the Golden State, but it is also among the most expensive for starter homes, according to BestMoney.
“Overall, we found California is the toughest place for shoppers looking to find a cheaper option as the state is home to 6 of the top 15 priciest cities for starter homes,” BestMoney said.
The three California cities that topped the list of most expensive cities for starter homes were:
This article originally appeared on Palm Springs Desert Sun: Starter homes becoming harder to find, notably in two California cities
Reporting by Daniella Segura, Palm Springs Desert Sun / Palm Springs Desert Sun
USA TODAY Network via Reuters Connect
