8 US Cities That Are Getting Cheaper for First-Time Homebuyers
Written by
G. Brian Davis
Edited by
Zuri Anderson
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
Despite the prevailing narrative on news feeds, the last two years have not been all doom and gloom for first-time homebuyers. In fact, many cities across the country have actually gotten cheaper, dipping from 2022 and early 2023 highs.
If you’ve been pinching pennies to save up a down payment for your first home, consider these cities that have gotten cheaper over the last few years — or at least remain affordable compared to nearby competition.
Austin, Texas
- Median home price: $513,622 (Zillow)
- Year-over-year change (YoY): -4%
“Austin has grown significantly in popularity and population size in recent years,” said Adam Hamilton, CEO of real estate accounting platform REI Hub. “A big reason for this has been because the city has turned into a tech hub. Tons of new tech businesses have found a home there, and thus tons of people moved there for work.”
Austin rode the pandemic wave of tech businesses fleeing the high taxes and unfriendly business environment in California. It saw a surge in home prices from mid-2020 to mid-2022, when median home prices peaked at $635,069, according to Zillow.
But like many cities that see a meteoric rise in home values, they then corrected based on the market fundamentals of supply and demand. With a median home price over $500,000, Austin isn’t “cheap” per se, but it’s far more affordable than it was two years ago.
Dallas-Fort Worth, Texas
- Median home price: $299,130 (Fort Worth)
- Year-over-Year Change: -0.7%
Why have so many Californians relocated to Texas? It isn’t just about tech companies transplanting there.
It also has to do with the lack of income taxes — and perhaps even more importantly, the eagerness of local governments to add new housing supply to keep homes affordable.
Indeed, the Dallas-Fort Worth metropolitan area leads the nation in new housing construction, according to housing data firm Zonda. That has kept home prices low and the population inflow high.
Cincinnati, Ohio
- Median home price: $235,327
- YoY change: 3.8%
Yes, Cincinnati home prices have risen in the last year, according to Zillow. But they remain 34.2% lower than the national average of $357,469.
“Cincinnati has stayed affordable for first-time homebuyers,” noted Hamilton. “I think a big reason for this is that other cities in Ohio have exploded in popularity — cities like Toledo, Dayton and Athens. With more people moving to these cities in Ohio, that has helped the Cincinnati market stay cool for homebuyers.”
Kansas City, Missouri
- Median home price: $233,826
- YoY change: 3.1%
Likewise, Kansas City has remained downright cheap even as it has become far more cosmopolitan over the last decade.
“Kansas City hasn’t seen the same spike in home prices over the past few years like a lot of other cities have,” said Seamus Nally, CEO of TurboTenant. “Home prices in some submarkets have actually declined in the wake of recent highs.”
Nally added that generous new construction policies have kept the region affordable.
“This area is doing pretty well for new builds, which is helping,” he said.
Benton, Arkansas
- Median home price: $232,196
- YoY change: 2.7%
Looking southward, much of Arkansas has also stayed accessible for first-time buyers.
Alexei Morgado, a real estate agent and CEO of Lexawise Real Estate Exam Preparation, pointed to Benton as a perfect example.
“I would recommend Benton, Arkansas, outside of Little Rock. Prices are floating around $197,500 in much of the town, which remains affordable with its cost of living index as compared to its median income,” he explained.
“I have met plenty of young families relocating here who like the slower, more affordable pace of life, plus some inducements for first-time buyers.”
Cape Coral, Florida
- Median home price: $370,293
- YoY change: -6%
Like Texas, Florida has enjoyed an influx of transplants from colder, higher-tax states. And while many coastal cities have exploded in cost, Cape Coral has corrected downward over the last year or two.
In fact, my own sister and brother-in-law moved there for that very reason. They love the warm weather, healthy lifestyle and access to the beach. Most of all, they love that they can afford a high quality of life there on entry-level salaries.
New Orleans, Louisiana
- Median home price: $233,470
- YoY change: -5.7%
Looking for a major city with not-so-major housing costs?
New Orleans enjoys the same affordability as many Midwestern cities, but boasts a deeper history and rich local culture. And it’s gotten even cheaper over the last year, unlike many coastal cities.
Wichita, Kansas
- Median home price: $194,867
- YoY change: 6.4%
Sure, Wichita has jumped in price over the past year — and it’s still cheaper than any other city on this list.
“In a world where homeownership feels out of reach for many Americans, Wichita is different,” explained Melanie Musson, a real estate expert with Quote.com. “It has a thriving job market, so people can find work that supports buying a home.”
Musson sees a city on the upswing, adding metropolitan amenities while retaining unpretentious prices and attitudes. She sums it up for both Wichita and similar cities on this list: “Wichita is a great place to get your foot in the door as a new homeowner.”
More From GOBankingRates
