Top 9 Urban Markets for First Time Home Buyers in 2019

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Have you noticed interest rates slowly rising this year? Just last month, Mortgage News Daily reported that interest rates for 30-year, fixed rate mortgages had crossed the 5% mark. Since then, rates have decreased to the 4.7% range, but the rates are much higher than they were last year.

Also, housing prices across the country have spiked. The improving economy has caused many potential home buyers to make the plunge and buy their first home.

But which urban market should you consider for your first home? We have reviewed several online sources and determined the following markets are your best bet as a first-time home buyer.

#1 Nashville, Tennessee

In October 2018, the Tennessean reported that Nashville’s real estate market had leapt passed many other hot markets and became one of the top five housing markets for first time buyers.

According to a representative at PricewaterhouseCoopers, the reason that Nashville has become such a good market is because of growth in employment, population growth and stability of employment. Another big factor in this market’s favor is no state income tax. This is becoming a bigger factor as first-time buyers decide where to get their home.

Nashville’s home prices have spiked 70% in the past six years. New residents are pouring into the city at a rate as high as 100 per day. The increasing prices have surprised residents; today, the median price for a single-family home is $250,000, which is still slightly below the overall market in the US.

#2 Tampa, Florida

Tampa has seen strong population growth in the past several years of 2%. Also, the average home price is reasonable at $195,000, which is a good deal for the first-time buyer with a limited down payment. First time buyers also like the fact there is no state income tax in Florida. With Orlando nearby, people in Tampa know that buying a home near such a hot tourist destination usually is a good investment.

#3 Indianapolis, Indiana

Indianapolis is a good urban market for first time home buyers. The median income in this part of the state is fairly low at $42,000, and the typical cost of a single-family home is still well below $200,000. Experts say the value per square foot in this city is only $71, making it a good deal for the first-time buyer with limited funds.

#4 San Antonio, Texas

San Antonio is ranked as one of the best cities for first time buyers because it is affordable, and the market is relatively stable. During the last downturn, home prices did drop in San Antonio, but the decrease was much less than most parts of the country.

Good things about San Antonio include a growing population, low unemployment, diverse work options including military, oil and gas, high tech and medical employment. There is much more going on economically in this city than oil, and that helps to make it a better place to buy a home.

Value per square foot is $80, and the median home price is approximately $230,000.

#5 Pittsburgh, Pennsylvania

Pittsburgh is nearly always ranked as one of the best urban areas for first time home buyers. In the last year, the funding for loans in this city has increased almost 40%. So, there are more conventional loans available in this city with down payments as low as 3%.

#6 Oklahoma City, Oklahoma

One of the great things about Oklahoma City is it has a very stable housing market. There were just four quarters of home price declines from 2011 to 2016. This is a very affordable market for first time buyers and its central location in the country makes it a big employer in industries from manufacturing to healthcare.

#7 Omaha, Nebraska

Omaha also has one of the best loan funding rates in the country. Of all homebuyers applying for conventional loans, 85% get their loans processed. This is a good sign that many people buying their first home will be able to get approved.

There are several home affordability programs for first time buyers in Omaha, such as the Omaha Housing Program that offers grants for down payment assistance to those who qualify.

#8 Colorado Springs, Colorado

Colorado Springs also has a very high loan funding ratio, and home prices are in the $300,000 range. There are nearly 100 HUD-approved lenders in this booming city. So, first time buyers with lower down payments and credit scores may get approved for FHA loans very easily.

#9 Fort Worth, Texas

Fort Worth is hot and is one of the most stable urban markets in the country. As with San Antonio, the city benefits from a strong local economy, low regulation, no state income tax, and diversity of employment.

These nine hot urban markets could be good choices for you to buy your first home!

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About Dusty Brazil

CA BRE #01780273- Dusty Brazil is a top ranked Realtor with Pacific Sotheby's International Realty. Mr. Brazil has been selling real estate in San Diego for over 10 years and lived in this coastal community his entire life. Dusty is an accomplished surfer who enjoys writing home buying articles when he is not catching waves.