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The Best Markets For First-Time Home Buyers In 2022

With 2022 shaping up to be another challenging year for hopeful home buyers, Realtor.com ran the numbers to find the best markets for people looking to buy their first homes this year. The first annual Best Markets for First-Time Home Buyers report predicts the cities and towns with the best combination of quality of life and affordability that young home buyers are looking for. 

What is it that makes these markets great for first-time buyers? They have strong job markets, short commute times, plenty of places to eat and drink, a younger population, affordability and more homes from which to choose.

The 2022 top 10 markets, in ranked order, are Magna, Utah; Chalco, Nebraska; Mauldin, South Carolina; Beech Grove, Indiana; Portsmouth, Virginia; Cottage Grove, Wisconsin; Grimes, Iowa; Kuna, Idaho; Ferndale, Michigan; and Maitland, Florida.

“Buying a first-home is always a challenging undertaking, and it’s been an especially tough couple of years for first-time buyers, many of whom are struggling to find a home that’s within their budget or win in a competitive bidding situation,” said Realtor.com chief economist Danielle Hale. “With this in mind, and the fact that remote work has given people more flexibility in where they live, we wanted to identify markets where first timers have a chance to become homeowners and find a great quality of life.”

Here are some of the reasons these markets are attractive to first-time home buyers:

More homes to choose from: The best markets boast almost twice the number of homes for sale than the national average. In 2021, these markets had 72.9 active listings per 1,000 households compared with the national rate of 44.9. Buyers looking for lots of options should check out Kuna, Idaho, which has the most choices on the list with 160 active listings per 1,000 households.

Lots of young people: The 10 best markets for first-time home buyers all have a younger population than the country overall. Specifically, these areas have an average of 15.2% of residents who are between 25 to 34 years old compared with 13.5% of the country overall. The city on the list with the most young people is Maitland, Florida, where you’ll find that 17.5% of the population are young adults. 

Plenty of choices for wining and dining: Lifestyle is important to a lot of first-time home buyers, and the best markets also include plenty of options for a night out on the town nearby. Realtor.com’s top places for first-time home buyers are in metros that have an average of 5.3 food and drink establishments per 1,000 households in the broader metro area, higher than other affordable places on our list, which average 5.0. Foodies can head to Magna in the Salt Lake City metro area, which has the most spots to dine out or grab a drink at 5.8 per 1,000 households.

More affordable homes: Sticking to a budget can be tricky for many first-time buyers, but the best markets have options for the cost-conscious. By comparing the typical home list price to the average income for young adults, Realtor.com determined that the home-price-to-income ratio in the best markets (3.9) was much lower than the national rate (5.0). Home shoppers who are looking for affordability can head to Chalco, Nebraska or Ferndale, Michigan, which offer the most affordability on the list.

Lots of good jobs – A healthy job market is important when finding a place to settle down, and the best markets are in metro areas that have lots of jobs to offer. These metro areas have a forecasted unemployment rate of just 2.7%, well below the national average of 3.6%. If job selection is at the top of the wish list, buyers can check out Chalco, Nebraska in the Omaha metro area and Cottage Grove, Wisconsin in the Madison metro area, which both have a forecasted unemployment rate of just 2.2%. 

Strong local housing markets – All of the cities on the list are within metro areas that are forecasted to have strong home sales and price growth. Sales in these  surrounding metro areas are projected to grow at 10.2% in 2022, much faster than the national average of 6.6%. Prices are expected to rise by 5.4%, which is significantly higher than the national average rate of 2.9%. Magna, Utah has the highest expected sales growth rate of 15.2% and the highest expected price growth of 8.5%.

Shorter commutes – No one wants to spend hours a day in the car or on a train, and the best markets offer jobs that are close to home. In fact, the average commute time in these markets is 26 minutes – that’s four minutes faster than the national average. If you’re looking for a short commute, try Grimes, Iowa, where locals typically get to work in just 23 minutes.

Magna, Utah: Coming in at No. 1, Magna is near Salt Lake City, which was named Realtor.com’s No. 1 Top Market for 2022. Magna’s easy access to the lakes and mountains are a huge draw for outdoor enthusiasts, and its close proximity to the city offers lots of jobs without a long commute. New home construction is booming in Magna, providing more options for home shoppers. The area has a fast-growing tech industry and is also an attractive destination for nature lovers who have the ability to work remotely. As such, it has seen a large influx of out-of-state transplants since the pandemic began.

Chalco, Nebraska: In the No. 2 spot, Chalco, Nebraska is just outside of Omaha. The Omaha area is home to four Fortune 500 companies, including Berkshire-Hathaway, offering lots of job opportunities. Locals enjoy leisure time at the Chalco Hills Recreation Area, a popular destination for hiking, biking and kayaking. There are also nine universities and colleges in the area, including University of Nebraska Omaha and Creighton University.

Mauldin, South Carolina: At No. 3 on the list is Mauldin, South Carolina, where first-time buyers will find small-town Southern charm and natural attractions combined with a short commute to Greenville’s downtown area, airport and strong job market. Residents have plenty to do in Mauldin itself, from its sports and cultural centers to a booming restaurant scene, including local favorites Wholly Smoke BBQ and Dillard’s Ice Cream. For young families, Mauldin also has top-rated schools like Monarch Elementary

Beech Grove, Indiana: Landing at the No. 4 spot is Beech Grove, Indiana. Known for a strong sense of community, Beech Grove is a city in its own right – literally – as the market is an “excluded city” with a separate government and police department from the nearby Indianapolis metro area. Home shoppers looking for a sense of nightlife will find plenty of restaurants in the Main Street downtown area, 24/7 bowling at Beech Grove Bowl and local craft breweries like Scarlet Grove. Beech Grove has good public schools and a K-8 private school for children.  

Portsmouth, Virginia: Taking the No. 5 place on the list is Portsmouth, Virginia. Located just across the Elizabeth River from Norfolk, this small town offers affordable home prices at $215,000 – well below the national average of $332,000 – and is within driving distance of a variety of outdoor activities such as water sports, boating, skiing, snowboarding and hiking. Home to Norfolk Naval Shipyard and Coast Guard Base Portsmouth, it has a large military population and offers many job opportunities in defense and related industries. Norfolk Southern and NASA Langley Research Center are two big employers in the area. 

Cottage Grove, Wisconsin: The sixth best market for first-time home buyers is Cottage Grove, Wisconsin. Just 15 miles outside of Madison, this hidden gem offers residents close proximity to city jobs with a slower pace of life. The town itself offers a variety of charming shops and restaurants and is a few minutes away from two prominent golf courses – The Oaks Golf Course and Door Creek Golf Course. When looking for nightlife, residents turn to Madison for its restaurant and bar scene and daytime activities such as boating on Lake Mendota and Lake Monona and visiting the popular Olbrich Botanical Gardens.

Grimes, Iowa: Landing in the No. 7 spot, Grimes, Iowa is just west of Des Moines. The area’s low cost of living and strong job market make it an attractive spot for young adults. Many residents are pleased to learn that they can buy a home for not too much more than the cost of renting. Popular activities include cheering on the Iowa State University football and basketball teams. Grimes is just a short trip to Des Moines, where locals can enjoy the arts and many cultural activities. Those looking to start a family will appreciate the highly rated schools.

Kuna, Idaho: No. 8 on the list is Kuna, Idaho, just outside of Boise. Locals love the area’s great access to outdoor activities, beautiful surroundings and friendly people. While the Boise housing market has been booming, young home buyers are likely to have better luck in Kuna than some of the surrounding towns. The area experienced an influx of transplants from areas like California and Washington who are drawn to the lower cost of living, great quality of life and good schools, including Falcon Ridge Public Charter. 

Ferndale, Michigan: In 9th place is Ferndale, Michigan. This city is attractive to first-time buyers because of its diversity, vibrant downtown area and great restaurants. It is well-known to locals for its thriving LGBTQ+ community. Ferndale’s proximity to Detroit and low price point make it attractive to first-time buyers looking to break into the housing market. Ferndale has recently experienced an influx of buyers from nearby states like Illinois and Ohio who appreciate the low cost of living.

Maitland, Florida: Rounding out the top 10 is Maitland, Florida. Located near Orlando, Maitland is home to several popular lakes and offers a wide range of homes, many of which are on large lots. The town’s good schools, such as Dommerich Elementary, are a draw for first-time home buyers with young children. During the pandemic, the area has seen a lot of transplants from places like California, New York and Boston, many of whom are taking advantage of remote work. The area is also home to a number of workers from Walt Disney World and Amazon.

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