If you’re looking for your first “starter home,” then you’re probably very frustrated. Across the nation, the inventory of these homes, usually scooped up by young first-time buyers, are extremely hard to find. If they are available, their price may be too high for the typical young buyer or Millennial.
The number of starter homes on the market dropped by 43.6 percent, while their share dropped from 30.2 percent to 27.7 percent, over the past four years, according to research from Trulia.com. The site examined housing stock in the 100 largest U.S. metro areas from January 1, 2012 to March 1, 2016.
Starter homebuyers today will need to shell out 5.6 percent more of their income — based on the median income of start-up buyers — towards a home purchase, compared to 2012, Trulia said.
This trend is one symptom of the market’s overall inventory shortage, writes Ralph McLaughlin for Trulia.
“America is experiencing a housing shortage,” writes McLaughlin. “Not only are there fewer homes available to buyers of all income levels, those just starting out or making their first foray into home ownership are worse off than they’ve been in years. There are fewer homes available, an even if they can find a home, it’s likely to be more expensive.”
• The number of trade-up homes on the market decreased by 41%, while the share of trade-up homes dropped from 27.2% to 26.1%. Trade-up homebuyers today will need to pay 2.6% more of their income for a home than in 2012;
• The number of premium homes on the market decreased by 33.4%, while the share of premium homes increased from 42.7% to 46.2%. Premium homebuyers today will need to spend 1.4% more of their income for a home than in 2012.