Realtor.com® Forecasts the 10 Best Markets for First-Time Homebuyers in 2025

Rhea-AI Summary

Realtor.com has released its 2025 Best Markets for First-Time Homebuyers report, with Harrisburg, Pennsylvania ranking as the top location. The report highlights opportunities in the Mid-Atlantic and Florida regions, with Rochester, NY, and Villas, FL rounding out the top three spots.

Despite forecasted mortgage rates remaining above 6% throughout 2025, increased inventory is expected to provide more options for buyers. The selected markets offer advantages in housing costs, inventory availability, and location quality. All top 10 markets feature median listing prices well below the national median of $416,880, with prices ranging from $129,900 in Rochester to $236,950 in Villas, FL.

These markets are characterized by strong local economies with below-average unemployment rates, proximity to major job hubs, and forecasted price growth exceeding the national projection of 3.7%. Florida markets show particularly strong growth potential, with Altamonte Springs expected to see a 12.1% increase.

Positive

• All top 10 markets have median listing prices significantly below national median of $416,880
• All selected markets forecast price growth above national projection of 3.7%
• Florida markets show strong appreciation potential (Altamonte Springs 12.1%, Villas 9.6%)
• All markets feature affordable housing costs below 30% of buyer income
• Selected markets have forecasted below-average unemployment rates

Negative

• Mortgage rates expected to remain above 6% throughout 2025
• Some markets lack amenities ( shopping/dining in Lansing and North Little Rock)
• Florida markets show daycare availability

Insights

Market Research Analyst

The Realtor.com® 2025 forecast reveals critical market opportunities in secondary and tertiary cities, particularly in the Mid-Atlantic region and Florida. The data shows median listing prices in top markets ranging from $129,900 to $236,950, substantially below the national median of $416,880. This price differential creates significant value opportunities for first-time buyers.

The standout metrics include price-to-income ratios between 2.5-4.1 and projected price growth exceeding the national forecast of 3.7%. Notably, Altamonte Springs leads with an anticipated 12.1% price appreciation, suggesting strong potential for equity building. The inventory levels per 1,000 households (ranging from 21.2 to 85.6) indicate healthier supply conditions compared to major metropolitan markets.

The demographic data showing 20.6% 25-34 year-old homeownership in Harrisburg versus 11.2% in Lauderdale Lakes suggests varying market maturity and entry opportunities across regions. These markets represent a strategic pivot from traditional gateway cities, offering better affordability metrics and potential appreciation upside.

Financial Analyst

The market dynamics presented in this forecast highlight a significant arbitrage opportunity in secondary markets. The price-to-income ratios below 4.1 across all top markets indicate relatively healthy affordability metrics, particularly when compared to national averages. This translates to lower barriers to entry for first-time buyers.

The Florida markets merit special attention due to their projected price appreciation rates. Altamonte Springs (12.1%), Villas (9.6%) and Lauderdale Lakes (9%) present compelling value propositions, especially considering Florida's favorable tax environment and population growth trends. The higher inventory levels in Florida markets (46.8-85.6 per 1,000 households) also suggest better negotiating positions for buyers.

The correlation between employment centers and housing affordability in markets like Harrisburg and Rochester presents a sustainable economic foundation for price stability and growth. The proximity to major job hubs while maintaining sub-$150,000 median listing prices creates a unique value proposition for investors and first-time buyers alike.

Homeowner Newbies Should Put Harrisburg, Penn., at the Top of their Search List

SANTA CLARA, Calif., Jan. 9, 2025 /PRNewswire/ -- For first-time homebuyers, the Mid-Atlantic and Florida are the best places to kickstart their home ownership journey in 2025. That's according to the 2025 Realtor.com^® Best Markets for First-Time Homebuyers report, which ranked Harrisburg, Penn., as No. 1 followed by Rochester, N.Y., Villas, Fla., Lauderdale Lakes, Fla., Altamonte Springs, Fla., Lansing, Mich., North Little Rock, Ark., Baltimore, Tonawanda, N.Y., and Wilmington, Del.

"Last year saw historically low activity for first-timers, with the group accounting for only 24% of successful homebuyers. While home prices remain high and mortgage rates are forecasted to stay above 6% throughout 2025, the year is expected to see more inventory hit the market – a silver lining for shoppers who will see more or less choice depending on where they are," said Danielle Hale, Chief Economist, Realtor.com^®. "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. Even in these high-opportunity areas, tradeoffs likely need to be considered for buyers to get to the closing table. Choosing the best place will come down to what's most important to each buyer and their family, and our list of places, and their qualities, is a good guide."

The Best Markets for First-Time Homebuyers in 2025

Rank	Place Name	Region	2025 Forecasted 25-34 Year Old Homeowner Share of Households	12 Month Ending November 2024 Inventory per 1000 Household	12 Month Ending November 2024 Median Listing Price	12 Month Ending November 2024 Price to Income Ratio	2025 Forecasted Average Travel Time to Work (Minutes)	2024 First-Time Homebuyer Location Score (out of 10)
1	Harrisburg, Penn.	Northeast	20.6 %	34.8	$140,000	2.6	22	9.2
2	Rochester, N.Y.	Northeast	22.3 %	21.2	$129,900	2.5	21	9.2
3	Villas, Fla.	South	14.1 %	85.6	$236,950	3.4	26	8.0
4	Lauderdale Lakes, Fla.	South	11.2 %	72.4	$154,850	2.7	32	7.7
5	Altamonte Springs, Fla.	South	19.4 %	46.8	$229,400	3.6	28	7.2
6	Lansing, Mich.	Midwest	21.4 %	42.3	$135,000	2.6	21	6.8
7	North Little Rock, Ark.	South	17.6 %	38.5	$160,000	3.3	22	5.7
8	Baltimore, Md.	South	19.9 %	51.6	$210,000	3.3	32	8.6
9	Tonawanda, N.Y.	Northeast	14.2 %	30.2	$229,900	2.9	22	8.1
10	Wilmington, Del.	South	18.4 %	41.3	$222,000	4.1	25	9.7

First-time home buyers are looking to invest in a home that they feel proud to own and comfortable buying. In the annual report, Realtor.com^® found the best markets that scored relatively high on factors important to folks starting their home ownership journey including affordable listings, strong local economies, lively places that are also great for growing families, and opportunities for a return on investment.

Affordable Homes
At a time when national asking rents have experienced year-over-year declines for 16 straight months, first-time buyers are looking to purchase a home that makes sense financially. As a general rule of thumb, a home being purchased or rented is "affordable" if it costs 30% or less of the renter/buyer's income each month. This rule holds true in each of the top 10 markets, ranging from 15.2% of prospective homebuyers' income in Rochester to 24.8% in Wilmington. Additionally, all 10 of the top markets have a median listing price well below the national median of $416,880. In fact, the most expensive market is Villas, Fla., which has a median listing price of $236,950, just shy of $180,000 less than the national median.

Strong Local Economy
As one of the biggest purchases many will make in their lifetime, maintaining payments on a mortgage requires gainful employment. Each of the markets ranked in the top 10 are forecasted to have lower than national average unemployment rates in 2025. Additionally, the markets are close to major job hubs including state capitols, which is the case for Harrisburg and North Little Rock, and academic institutions and hospitals, as is the case for Rochester, Lansing, and Baltimore. Wilmington is even within commuting distance to the major city of Philadelphia.

Fun for Everyone
This year's rank of best markets for first-time homebuyers provide options for all walks of a first-time homebuyer's life. Daycares for growing families. Nightlife for single adults, and parents who need a night out. Prime choice groceries and shopping for all. Each of the markets have above-average location scores, though they also have their respective strengths and drawbacks across the categories. For example, foodies, shopaholics, and bar hoppers might not have many great options in Lansing and North Little Rock, though they score very well for family-friendliness, and daycares aren't as plentiful in the Florida markets of Villas and Altamonte Springs, but are forecasted to have great price growth. 

Show me the ROI
As a major financial investment and pathway to home equity, the ROI of a home purchase is a big consideration especially for first-time home buyers putting their first stake in the ground during a time with high mortgage rates and listing prices. Each of the places uncovered in this year's top 10 list are forecasted to see price growth at a rate over the national projection of 3.7%, but the three Florida markets are expected to see the largest gains; Altamonte Springs (12.1%), Villas (9.6%) and Lauderdale Lakes (9%).

Methodology
This year, the candidate list of places was filtered to only expose areas with an expected 2025 population of at least 5,000 and at least 500 homes for sale. The inventory of homes for sale and local median listing prices are from Realtor.com® December 2023 to November 2024 listing data and are reported at the Census Designated Place level. The population, household count, household income, and average commute time data were sourced from 2024 and 2025 Claritas estimates based on Census Bureau data. Population and household count numbers, household incomes, and average commute times are at the city/place level. The stated forecasted unemployment rates are Moody's Analytics projections of U.S. Bureau of Labor Statistics Local Area Unemployment Statistics for each city/place's surrounding metro area. Location scores for each place were aggregated from property-level assessments made by Local Logic in the third quarter of 2024 pertaining to the availability of shopping, daycares, restaurants, grocery stores, and nightlife near each known property in the place. Local Logic is a leading location intelligence company using over 100 billion data points to power smarter real estate decisions. Trusted by 50 million users each month across 8,000+ websites, Local Logic helps consumers, investors, and governments optimize neighborhoods, developments, and cities. Learn more at locallogic.co. The 2025 sales and price forecasts are Realtor.com® projections for each city/place's surrounding metro area as detailed in our 2025 Housing Forecast and Top Housing Markets for 2025 reports.

About Realtor.com^®
Realtor.com^® is an open real estate marketplace built for everyone. Realtor.com^® pioneered the world of digital real estate more than 25 years ago. Today, through its website and mobile apps, Realtor.com^® is a trusted guide for consumers, empowering more people to find their way home by breaking down barriers, helping them make the right connections, and creating confidence through expert insights and guidance. For professionals, Realtor.com^® is a trusted partner for business growth, offering consumer connections and branding solutions that help them succeed in today's on-demand world. Realtor.com^® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. For more information, visit Realtor.com^®.

Media contact: Asees Singh, press@realtor.com

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SOURCE Realtor.com

FAQ

What is the best market for first-time homebuyers in 2025 according to Realtor.com?

According to Realtor.com's 2025 report, Harrisburg, Pennsylvania ranks as the number one market for first-time homebuyers, followed by Rochester, NY and Villas, FL.

What is the median listing price in the top-ranked market Harrisburg?

The median listing price in Harrisburg, Pennsylvania is $140,000, which is significantly below the national median of $416,880.

What price appreciation is forecasted for Altamonte Springs, FL in 2025?

Altamonte Springs, FL is forecasted to see a 12.1% price appreciation in 2025, the highest among the top 10 markets.

How do housing costs compare to income in the top 10 markets?

Housing costs in all top 10 markets remain affordable, ranging from 15.2% of buyers' income in Rochester to 24.8% in Wilmington, all below the recommended 30% threshold.

What are the expected mortgage rates for first-time homebuyers in 2025?

Mortgage rates are forecasted to remain above 6% throughout 2025 according to the report.