First-time homebuyers in 2025 face one of the most challenging housing markets in decades, with high home prices, elevated mortgage rates, and fierce competition. However, for those willing to explore the right cities, opportunities abound. A recent report by Realtor.com® highlights the top 10 U.S. markets where first-time buyers can find affordability, strong local economies, and promising growth potential.

Why Harrisburg, PA, Tops the List

Harrisburg, PA, takes the No. 1 spot, offering a rare combination of low home prices, a strong job market, and a central location near major cities like Philadelphia and Baltimore.

• Affordability: The median home price in Harrisburg is just $140,000, making monthly mortgage payments lower than the average rent for a two-bedroom apartment in the area—even with 7% interest rates.

• Job Opportunities: The city benefits from a diverse economy supported by logistics hubs for companies like Amazon and Chewy, alongside major employers like Hershey Foods and Penn State Hershey Medical Center.

• Starter Homes: Harrisburg’s abundance of townhomes allows first-time buyers to enter the market at a lower cost while building equity for future upgrades.

Chris Timmons, a local real estate broker, notes, “Truthfully, it’s somewhat easier to buy a house than rent an apartment in Harrisburg. If you’re renting, you often need a higher credit score and upfront costs that make buying the more attractive option.”

Other Top Cities for First-Time Buyers

1. Rochester, NY – Median home price: $129,900

• Offers a home purchase assistance program providing grants of up to $6,000.

• Low price-to-income ratio, with homes priced at just 2.5 times median earnings.

2. Villas, FL – Median home price: $236,950

• Located near Fort Myers, offering proximity to beaches and an affordable suburban lifestyle.

3. Lauderdale Lakes, FL – Median home price: $154,850

• A short drive from Fort Lauderdale with home prices well below the regional average.

4. Altamonte Springs, FL – Median home price: $229,400

• A growing Orlando suburb with excellent amenities and forecasted home price growth of 9%.

5. Lansing, MI – Median home price: $135,000

• Home to Michigan State University and a high-tech General Motors plant, creating steady job demand.

6. North Little Rock, AR – Median home price: $160,000

• Benefits from economic growth in nearby Little Rock but offers lower home prices.

7. Baltimore, MD – Median home price: $210,000

• The largest city on the list, Baltimore offers city amenities at a fraction of the cost of neighboring D.C.

8. Tonawanda, NY – Median home price: $229,900

• A quiet suburb of Buffalo with affordable homes and strong community ties.

9. Wilmington, DE – Median home price: $222,000

• A mid-Atlantic gem with historic charm and easy access to Philadelphia and Washington, D.C.

Trends to Watch in 2025

Although home prices remain high and mortgage rates are expected to stay above 6%, several buyer-friendly trends are emerging:

• Increased Inventory: The supply of homes for sale recently reached a four-year high, giving buyers more options.

• Price Reductions: More homes are hitting the market with price cuts as sellers adjust expectations, particularly in overheated markets.

• Stabilized Price Growth: The frenzied price growth that followed the COVID-19 pandemic has slowed, creating more sustainable buying conditions.

Why This Matters for Real Estate Developers and Investors

Understanding where first-time buyers are entering the market can provide developers and investors with key insights:

• Emerging Markets: Cities like Harrisburg, Rochester, and Villas are hotspots for entry-level buyers but also present opportunities for build-to-rent communities, multifamily developments, and single-family home investments.

• Affordability Strategies: Developers can tailor projects to meet demand for affordable, well-designed homes that cater to first-time buyers, remote workers, and young families.

• Long-Term Equity: Areas with strong job markets and lower home prices create attractive conditions for long-term equity growth, benefiting both investors and homebuyers.

About Daniel Kaufman

Daniel Kaufman is a real estate developer, investor, and community builder with a passion for helping people understand and navigate the housing market. His expertise spans build-to-rent developments, multifamily housing, and mixed-use projects. Whether you’re an aspiring homebuyer or a seasoned investor, Daniel’s goal is to provide insights that lead to smart, strategic decisions.

📧 Email: daniel@kaufmanredev.com

🌐 Website: danielkaufmanre.com

Looking to discuss market trends or investment opportunities? Contact Daniel Kaufman today to take the next step in your real estate journey!