A new analysis by Realtor.com<\/a> finds that the cost of a typical starter home has risen from $256,000 in 2019 to $344,000, while the share of affordable listings priced under $350,000 has fallen from 55% to 37.6% in that period.<\/p>\n Realtor.com senior economist Hannah Jones told FOX Business that the market for starter homes has changed “dramatically” since the pandemic, with shifts driven by higher mortgage rates and inventory limitations.<\/p>\n “Factoring in mortgage rates, the income needed to qualify has risen from $43,000 to $78,000, a jump that incomes haven’t matched, and monthly payments are up more than 80% since 2019,” she said. “Altogether, buyers are paying more for less and the squeeze is most severe for the bottom tier of earners.”<\/p>\n WHY HOMEBUYERS ARE RACING TO THIS PENNSYLVANIA PORT CITY<\/a><\/p>\n Starter homes are more scarce and higher priced than they were before the pandemic, though those metrics have improved in the last few years. (Eric Thayer\/Bloomberg\/Getty Images)<\/p>\n Those dynamics have contributed to a rise in the age of the average first-time homebuyer to 40 years old, with Jones noting that the share of first-time buyers was only 30% a year ago \u2013 though it recovered somewhat to 35% in May.<\/p>\n “The profile has shifted toward higher-income households<\/a> who can qualify at current rates, because lower-income buyers have largely been priced out,” she said.<\/p>\n “More households are pooling resources, living with parents longer to save, or relocating to more affordable markets<\/a>. The practical effect is that today’s starter home buyer increasingly resembles the move-up buyer of a decade ago,” Jones said.<\/p>\n MORTGAGE RATES JUMP TO HIGHEST LEVEL IN ALMOST A YEAR<\/a><\/p>\n The average age of a first-time homebuyer has risen in recent years. (David Paul Morris\/Bloomberg via Getty Images)<\/p>\n The report noted that there are 220,000 more starter homes for sale compared with 2022, with prices down 4.2% from that period, so there has been improvement in the last few years after the pandemic shock.<\/p>\n Jones said that most of that change is due to new construction \u2013 much of which has occurred in the South \u2013 while homeowners with relatively low mortgage rates<\/a> are largely remaining in place due to their reluctance to take on a higher-rate mortgage after moving.<\/p>\n “Builders in Texas, Florida, and the Carolinas drove the South’s recovery by bringing supply to market just as demand moderated,” she said. “Lock-in is still very much in play nationally, with almost 70% of outstanding mortgages at 5% or below<\/a>. Life-event-driven turnover is happening at the margins, keeping the market cranking, but hasn’t meaningfully unlocked existing inventory more broadly yet.”<\/p>\n![\"A](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2026\/07\/1784600598_733_for-sale-home.png\")
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