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Ten Markets Primed for First-time Buyers

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Affordable monthly mortgage payments, positive home values, and competition are attracting first-time homebuyers to these 10 markets.

Zillow identified the top 10 best markets for first-time buyers based on places where it's more affordable to make a monthly mortgage payment than a monthly rental paymentmedian home values and competition, including how many homes the first-time buyer has to choose from and whether they are likely to be up against all-cash offers.

At the top of the list for new entrants into the market is Indianapolis, Pittsburgh, and Memphis.  Indianapolis has a Zillow Home Value Index of $130,000 and buyers would pay only 11 percent of their monthly income on the mortgage payment compared to 26.1 percent of income for a monthly rent payment. 

Buying your first home is a big decision that takes a lot of planning," said Zillow Chief Economist Dr. Svenja Gudell. "First-time buyers across the U.S. are up against high prices and low inventory, but these are the places where the availability of affordable, entry-level homes and the presence of cash-buyers are less of an issue."

Zillow's Top 10 Best Markets for First-Time Home Buyers:

  1. Indianapolis, Indiana 
  2. Pittsburgh, Pennsylvania 
  3. Memphis, Tennessee 
  4. Cleveland, Ohio
  5. Chicago, Illinios 
  6. Oklahoma City, Oklahoma
  7. St. Louis, Missouri 
  8. Houston, Texas 
  9. Tampa, Florida 
  10. Birmingham, Alabama

"First-time buyers in these markets won't have to deal with as many bidding wars or run-away prices; they'll be able to find a first home that fits their needs with less stress," Gudell stated. "With record low mortgage rates, it's a good time to buy a home and certainly worth considering."    

Zillow reported that the worst markets for first-time buyers include: Salt Lake City, Utah; Washington, D.C.; New York/Northern New Jersey; Austin, Texas; San Jose, California; Los Angeles-Long Beach-Anaheim, California; Sacramento, California; San Francisco, California; San Diego, California; and Seattle, Washington.

About Author: Brian Honea

Brian Honea's writing and editing career spans nearly two decades across many forms of media. He served as sports editor for two suburban newspaper chains in the DFW area and has freelanced for such publications as the Yahoo! Contributor Network, Dallas Home Improvement magazine, and the Dallas Morning News. He has written four non-fiction sports books, the latest of which, The Life of Coach Chuck Curtis, was published by the TCU Press in December 2014. A lifelong Texan, Brian received his master's degree from Amberton University in Garland.
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