The Best Places for First-Time Homebuyers in 2023

The high real estate market continues to make it difficult for first-time homebuyers to enter the market. However, some metropolitan areas offer a combination of affordable real estate, a strong job market, and high scores for wellness and cultural amenities. According to the 2023 Bankrate Best Metros for First-Time Homebuyers study, Austin, Texas is the most attractive place for first-time homebuyers, followed by other cities in the Midwest and Sun Belt regions. On the other hand, the least attractive region for first-time homebuyers is the Washington, D.C. metropolitan area, followed by two metropolitan areas in the Northeast and two in Southern California.

The top cities for first-time homebuyers are Austin, Texas, Kansas City, Raleigh, Minneapolis, and Jacksonville. Austin has a thriving job market, and high scores in market tightness, wellness, and culture, but is challenged by affordability with a median home price of $565,000 as of September 2022. Despite these challenges, the housing market has become more favorable for buyers over the past year, making it an attractive option for first-time homebuyers.

Matt Smith, a 35-year-old first-time homebuyer, moved to Austin from New York City in 2019 and, after the pandemic, decided to stay and search for a condo. He encountered intense competition in a seller's market but successfully purchased a one-bedroom condo in downtown Austin in 2022, as the market cooled. Smith appreciated the affordability of Austin compared to the New York City metropolitan area, with its modest property taxes and lack of a state income tax.

Ashley Jackson, President of the Austin Board of Realtors and a Realty Austin agent, reflects on Austin's evolution from a small town to a booming city. With the arrival of tech giants like Apple, Amazon, and Google, the city's prosperity has skyrocketed, with a median family income of $110,300 in 2022 and a 45% increase over the past decade. Although this has led to a rise in home prices, the housing market has become more favorable for buyers in the last year, making Austin an attractive choice for first-time homebuyers.