Top 10 Cities for First-Time Home Buyers

Top 10 Cities for First-Time Home Buyers—and Not Just Because They’re Affordable

 

OK, let’s get it right out there: It’s a seriously tough time to be trying to buy your first home. Yes, in most respects the housing business is doing great. But the dazzling nationwide sales boom cuts both ways: Across the U.S., low inventory has put the squeeze on potential home buyers, driving prices up to nosebleed-inducing levels and sparking scary bidding wars. And first-time mortgages? They’re harder than ever to snag.

The numbers tell the tale: The National Association of Realtors® reported in November that the share of first-time buyers had declined in 2015 for the third consecutive year and remained at its lowest point in nearly three decades. First-time buyers made up 32% of all buyers in 2015, down from 33% the year before.

So where can today’s committed-but-oh-so-frustrated housing newbies turn?

We’ve got you covered! Bypassing today’s unabashed and unbowed metro seller’s markets (See ya, Seattle! Don’t let the door hit you on the way out, Dallas!), we set out to find  places that are still newbie-friendly. But we weren’t just looking for the cheapest places. Yes, affordability is key, but if you’re doling out your life savings on a new home, you want an area where you’ll actually enjoy living! Right? So we made sure that our top 10 cities bring something extra special to the party, lifestylewise.

We focused on the 25-to-34 age group, which is the vast majority of first-time home buyers. We filtered the 100 largest U.S. metropolitan areas using the following criteria:

  • Affordability, measured by home price to income ratio for 25- to 34-year-olds (the lower the better)
  • Inventory, with enough houses available that you don’t have to camp out at open houses or sell your firstborn to get your chance—measured by the number of homes for sale per 1,000 households
  • Mortgage availability, measured by the share of home loans purchased by 25- to 34-year-olds
  • Job growth, measured by lower-than-average unemployment rate (because unemployment and new homes are a lousy combo)
  • Livability, measured by the number of restaurants, schools, retailers, health care facilities, and arts and entertainment venues per 1,000 households

 

  1. Portland, ME

Median price: $304,000

Unemployment: 3.3%

What you don’t know about Portland: Yeah, sure, the West Coast’s Portland gets all the press, the hipster cred (and notoriety), and even a decent TV show to call its own. But here’s the deal: The largest city in Maine is no less hip, cool, and fun to live in. And it has way better lobster.

A foodist’s paradise nestled on the Atlantic coast, Portland has a slew of catch-of-the-day seafood restaurants and a thriving microbrew scene—Allagash Brewing Co. produces 45,000 barrels of beer each year. And check out that unemployment rate—one-third lower than the national average of 5.2%.

 

  1. Philadelphia, PA

Median price: $222,000

Unemployment: 4.8%

What you don’t know about Philly: Plenty of New Yorkers are fleeing the City So Nice They Named It Twice for Philly, with almost 27,000 people making the transition per year, according to the U.S. Census Bureau. Many seem to relish escaping the crazy real estate prices of NYC without giving up big-city amenities.

So what’s the appeal?

Well, you’ve got Ukee Washington, Denzel‘s second cousin and quite possibly the coolest news anchor in America. You have perhaps the most loyal sports fans in the country. And you can get a “citywide special”—a can of PBR and a shot of Jim Beam—for just a few bucks across town. The United States’ first capital is rich in history and has recovered from a bad patch—no longer known as “Killadelphia,” its violent crime rate declined 20% from 2009 to 2014, according to the FBI.

 

  1. St. Louis, MO

Median price: $164,000

Unemployment: 5.2%

What you don’t know about St. Louis: Besides the Cardinals and the city’s namesake barbecue, there’s plenty more to celebrate in St. Louis.

Led by Washington University, more than a dozen universities and colleges boost the city’s IQ and keep the vibe young. You dig nature? You can spend weeks hanging in Forest Park, which is nearly 50% bigger than Central Park. And the city has two separate downtowns, each with its own gestalt. Housing prices have been low, partly because of the sluggish economy after the recession that erased thousands of jobs. But the city has finally made a comeback, adding 6,900 jobs in February and posting a declining unemployment rate. Eight Fortune 500 companies now call St. Louis home.

 

  1. Allentown, PA

Median price: $188,000

Unemployment: 5%

What you don’t know about Allentown: While the song “Allentown” by Billy Joel reminds us of the decline of the coal and steel industry (and still makes us sob), Allentown is en route to aggressive economic redevelopment.

Today the city hosts multinational companies such as Pennsylvania Power and Light and Air Products & Chemicals. Allentown also has Pennsylvania’s highest beer production by volume, and the Lehigh Valley area makes up the state’s fastest-growing wine region. And contrary to its grungy/gritty rep, there are more acres of parkland here than in any other city of this size. Take that, Billy!

 

  1. Albany, NY

Median price: $238,000

Unemployment: 4.5%

What you don’t know about Albany: The capital of New York state is having a renaissance. The effort to build a “Tech Valley” since 1998 has paid off with thriving new businesses, residential development, entertainment, and a cultural scene. Every spring, Albany celebrates its Dutch heritage with the Tulip Festival, featuring more than 200,000 tulips, fine art shows, crafts, and gardening exhibits. And you haven’t lived until you’ve tried an Albany fish fry. Or at least you haven’t lived well.

 

  1. Harrisburg, PA

Median price: $168,000

Unemployment: 4.2%

What you don’t know about Harrisburg: Tech may not be something this central Pennsylvania city is known for, but it may be in the future. In the past few years, at least 18 tech companies have sprouted in this midsize city. Benefiting from the tech wave, downtown Harrisburg has become a hugely popular northeastern destination stop for great live entertainment, especially music—from jazz to indie to hip-hop.

 

  1. Baton Rouge, LA

Median price: $217,000

Unemployment: 4.8%

What you don’t know about Baton Rouge: With a median age of 34.7 for its population, Baton Rouge is Louisiana’s youngest major metro area (the credit goes to Louisiana State University, which is based there).

About 80 miles from New Orleans, Baton Rouge knows how to do Mardi Gras right. Each year thousands flock to the city for festive carnivals, costume balls, and six different parades (including one just for pets). Increasingly a nouveau hipster haven, the city has the highest share (52%) of mortgages purchased by 25- to 34-year-olds among all the markets we studied.

 

  1. Dayton, OH

Median price: $115,000

Unemployment: 5.2%

What you don’t know about Dayton: Bike culture may be awesomely hip now, but Daytonians have been biking en masse for a long, long time. They drafted the nation’s first regional bikeway plans, which were adopted in 1973. Since then, the 300 miles of scenic Miami Valley Trail—the nation’s largest paved trail network—have seen generations of cyclists. With a median home price of just $115,000, Dayton is no longer a place to fly over or drive through—it’s a place to stay and live large.

 

  1. Minneapolis, MN

Median price: $294,000

Unemployment: 3.9%

What you don’t know about Minneapolis: America’s second fittest city, Minneapolis boasts more than 200 miles of bike lanes and 5,000 acres of parkland. Twelve Fortune 500 companies, including Target, and numerous small businesses keep unemployment low and income high.

America’s (purportedly) most literate city also hosts Open Book, the country’s biggest book art center, and the Chanhassen, its largest dinner theater. And Mary Richards lived here. Questions?

 

  1. Virginia Beach, VA

Median price: $256,000

Unemployment: 5%

What you don’t know about Virginia Beach: Pharrell Williams was born and raised here, and his song “Happy” could easily serve as the official town anthem . After all, with sun-drenched beaches dotted with swimmers, sunbathers, and volleyball players, how could anyone not be happy? Plus, the city’s majority of low-density neighborhoods are perfect for those who hate crowded city living.

———

We’re in such a celebratory mood, we almost hate turning our eyes to the worst markets for first-time home buyers. Almost.

New York and San Francisco, you say? If the two cities had a penny for each time someone complained about their sky-high housing prices, the money could probably fund many buyers’ down payments. But for many people, the excitement and job opportunities of those cities are worth the price.

By our calculation, the worst markets are where climbing home prices and plunging inventory are not sustained by employment and infrastructure—or any real sense of fun. Because fun rules!

Spoiler alert: The bottom five markets are all in California. As Jonathan Smoke, our chief economist, points out, those markets are affected by the “spillover” effect of being in California—filled with people looking for alternatives to Los Angeles and San Francisco.

  1. Stockton, CA

Median price: $340,000

Unemployment: 8.8%

  1. Fresno, CA

Median price: $262,000

Unemployment: 10.5%

  1. Bakersfield, CA

Median price: $222,000

Unemployment: 10.9%

  1. Sacramento, CA

Median price: $428,000

Unemployment: 5.4%

  1. Riverside, CA

Median price: $344,000

Unemployment: 5.8%

What are your thoughts on the subject?

I read this article at: http://www.realtor.com/news/trends/top-10-cities-for-first-time-home-buyers/?identityID=9851214&MID=2016_0415_WeeklyNL-comafter23&RID=353497822&cid=eml-2016-0415-WeeklyNL-blog_1_topcities-blogs_trends

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.  

Email Sabrina & Susan at: Info@TheCatonTeam.com

Call us at: 650-568-5522

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Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Berkshire Hathaway HomeServices – Drysdale Properties

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE# 70000218/ Office BRE #01499008

7 Signs of An Up-and-Coming Neighborhood

I truly enjoyed this article – had to share…

7 Signs of An Up-and-Coming Neighborhood

Live in a town large enough for a time long enough, and you’ll undoubtedly be made privy to a story of the one that got away. The neighborhood that got away, that is – the neighborhood that all the locals saw as down for the count, pshawing away little sprouts of area upturn, until one day the formerly downtrodden district was teeming with new businesses, new residents, new life – and newly high property values, to the advantage of those few brave souls who decided to go all in before the place actually arrived.

Maybe you’re a first-time buyer trying to squeeze every iota of value out of your precious house hunting dollars, or you just love the prospect of being an early settler in your city’s Next Big Neighborhood. In any event, it can be daunting and even scary to try to figure out whether a neighborhood is up-and-coming or down-and-out. Home value increases are an obvious indicator, but by the time values are up it’s often too late to get in on the early advantage of buying in a neighborhood before it’s potential has been realized.

If you’re ready, willing and able to take on the challenge of buying in a diamond-in-the-rough type neighborhood, here are some signs to look for before property values shoot through the roof.

1. On-trend businesses are moving in. In my neck of the woods, when a co-working space, a Whole Foods or a Blue Bottle coffee moves into the neighborhood, it’s a sign that the nature of things might be changing. This is just as true for small, local businesses that attract people with disposable income as it is for businesses that sell the basics with flair. In fact, most larger businesses do a fair amount of economic research and projections on the neighborhood before moving in. Watching big industry and business moves can be a great way to spot emerging areas with strong fundamentals way before you might otherwise be able to see them yourself.

2. Uber-convenient location in a land-impacted metro. If you live in a densely populated metro area – especially one that is coastal – or an urban setting with intense governmental restrictions on building, demand for homes will continue to grow as the population does, but the supply will remain somewhat limited. In many of these situations, neighborhoods that have been downtrodden but have very convenient proximity to employment centers, public transportation, freeways and bridges tend to be prime for whole-neighborhood remodeling in times of population growth or rapid real estate price rises in already-prime areas.

3. Downsides have an expiration date. If there’s one major issue that has caused an area to be less desirable for decades, and that issue is being eliminated or ameliorated, it could set the neighborhood up for a turnaround. For example, striking crime decreases or a major employer moving into the area where none were before can spark a serious real estate renaissance in an area which has some of the other desirable features on this list.

Also, keep in mind that a new generation of home buyers has a new set of values, and might simply not be concerned or deterred by things their parents might have viewed as turn-offs. Living above a commercial unit might have been a deal-killer for my parents, but my son thinks it’s cool – even desirable, depending on the business on the ground floor. Similarly, gritty and urban might not be the descriptors of your dream home, but some twenty-something first-time buyers in major metros are seeking exactly that feel.

4. Architectural themes with a following. Many up-and-coming neighborhoods find themselves pulled by aficionados of the particular type of architecture that characterizes the neighborhood. Often, down-at-the-heels neighborhoods that are riddled with Tudors, Victorians, Spanish-style homes or even Mid-Century Moderns will see a surge of revitalization when a fresh generation of frugal home buyers falls in love with the style and realizes the deals that can be had there vs. other, already prime areas in town.

5. At least one major economic development is brewing. Never underestimate the power of a major economic development to overhaul a neighborhood’s fate. From Google and Microsoft building cloud storage data centers in Des Moines to a new light rail station going live in Denver, one large-scale employer or infrastructure development can be a very early, very strong sign that an area will see it’s real estate fortunes rise. (That said, areas dependent on one near-obsolete employer or industry can see their fates decline rapidly. Look for industry-wide investment in an area, vs. a single company’s investment.)

6. Fixing is in the air. When you see that an area long known for its rundown homes has a number of homes being renovated and rehabbed from the inside out, this can be a sign of fledgling neighborhood turnaround. If you spot these sorts of projects visually, it might be worth taking a trip down to the City Building Permit counter to see whether the staff has seen the same uptick in individual owners’ investment in the area, and if so, what they think the story of the neighborhood might be – or might become. City staffers often have a wealth of information at the ready, everything from pending commercial development applications that could change the whole landscape of an area to projects the city itself has funded or will prioritize due to its own development initiatives.

7. Slow but steady decrease in DOM. Ten years ago, I listed a charming, pristine home on a not-so-charming, less-than pristine street – the location was its fatal flaw, and the place just lagged on the market as a result. Now, Millennials buying their first homes are salivating over that precise location, for its mix of urban feel; new trendy restaurants and yoga studios; and complete convenience to both the subway and the Bay Bridge. In between now and then, though, those who were watching carefully would have noticed how homes that once took 90 days to sell gradually were selling in 45, then in a couple of weeks – and would have noticed that this decline in the number of days an average listing stayed on the market (DOM) occurred way before the home prices themselves increased. A slow, steady decrease in DOM is a smart, early sign that a neighborhood might be poised on the precipice of up-and-coming status. Ask your agent to help clue you in as to where precisely those areas might be, in your town.

BUYERS: Are you looking to move into an up-and-coming neighborhood? If so, what’s your motivation?

SELLERS: Was your neighborhood an up-and-coming one? Share your experience!

I truly enjoy sharing these articles – hope you did too – would love to hear your input!

 

I read this article at: http://tips.truliablog.com/2014/01/7-signs-of-an-up-and-coming-neighborhood/?ecampaign=cnews201401D&eurl=tips.truliablog.com%2F2014%2F01%2F7-signs-of-an-up-and-coming-neighborhood%2F

Remember to follow our Blog at: https://therealestatebeat.wordpress.com/

Got Questions? – The Caton Team is here to help.  

Email Sabrina & Susan at:  Info@TheCatonTeam.com

Call us at: 650-568-5522  Office:  650-365-9200

Want Real Estate Info on the Go?  Download our FREE Real Estate App:  http://thecatonteam.com/mobileapp

Visit our Website at:   http://thecatonteam.com/

Visit us on Facebook:   http://www.facebook.com/pages/Sabrina-Susan-The-Caton-Team-Realtors/294970377834

Yelp us at: http://www.yelp.com/biz/the-caton-team-realtors-sabrina-caton-and-susan-caton-redwood-city

Or Yelp me:  http://www.yelp.com/user_details_thanx?userid=gpbsls-_RLpPiE9bv3Zygw

Connect with us professionally at LinkedIn:  http://www.linkedin.com/profile/view?id=6588013&trk=tab_pro

Please enjoy my personal journey through homeownership at:

http://ajourneythroughhomeownership.wordpress.com

Thanks for reading – Sabrina

The Caton Team – Susan & Sabrina – A Family of Realtors

Sabrina BRE# 01413526 / Susan BRE #01238225 / Team BRE#70000218/ 01499008