Buying a home for the first time is an exciting and important milestone for many Americans. Their purchases make up a sizable chunk of the market, too. In 2020, 40% of all U.S. single-family home purchases were made by first-time buyers, and 14% more people became first-time buyers than the previous year. This growth is due in part to the fact that interest rates dropped dramatically during the COVID-19 pandemic.
For people willing and able to invest in a house this year, the search for a first home requires careful consideration of a number of factors. Buyers must balance what they want and need with what they can afford. Often, people begin searching for their dream homes without a realistic idea of market prices, interest rates or even their eligibility to get a mortgage.
Where a home is located is just as important as what features it has. If the neighborhood is unpleasant, it can sour the experience of a great home. Potential buyers may want to narrow their search down to an area with a good reputation before getting into housing details.
To simplify the process, WalletHub compared 300 cities of varying sizes across 22 key indicators of market attractiveness, affordability and quality of life. Our data set ranges from cost of living to real-estate taxes to property-crime rate.
Main Findings
Best Places for First-Time Home Buyers
| Overall Rank | City | Total Score | Affordability | Real-Estate Market | Quality of Life |
|---|---|---|---|---|---|
| 1 | Chesapeake, VA | 65.15 | 28 | 24 | 4 |
| 2 | Gilbert, AZ | 61.91 | 22 | 5 | 96 |
| 3 | Lincoln, NE | 61.29 | 89 | 59 | 1 |
| 4 | Cape Coral, FL | 61.01 | 112 | 3 | 33 |
| 5 | Boise, ID | 60.68 | 36 | 45 | 5 |
| 6 | Hampton, VA | 60.66 | 21 | 72 | 29 |
| 7 | Peoria, AZ | 59.76 | 35 | 9 | 143 |
| 8 | Virginia Beach, VA | 59.47 | 45 | 131 | 3 |
| 9 | Norfolk, VA | 58.97 | 46 | 114 | 25 |
| 10 | Surprise, AZ | 58.87 | 20 | 17 | 177 |
| 11 | Orlando, FL | 58.46 | 150 | 2 | 101 |
| 12 | Chandler, AZ | 58.3 | 37 | 26 | 121 |
| 13 | Cedar Rapids, IA | 58.28 | 14 | 107 | 34 |
| 14 | Tampa, FL | 58.12 | 155 | 7 | 26 |
| 15 | Broken Arrow, OK | 57.78 | 70 | 20 | 128 |
| 16 | Raleigh, NC | 57.55 | 62 | 76 | 42 |
| 17 | Scottsdale, AZ | 57.4 | 118 | 18 | 51 |
| 18 | Kenosha, WI | 57.37 | 55 | 133 | 7 |
| 19 | Palm Bay, FL | 57.16 | 81 | 25 | 95 |
| 20 | Elgin, IL | 56.98 | 92 | 65 | 21 |
| 21 | Joliet, IL | 56.9 | 57 | 130 | 15 |
| 22 | Frisco, TX | 56.87 | 231 | 1 | 60 |
| 23 | Newport News, VA | 56.6 | 50 | 162 | 18 |
| 24 | Huntsville, AL | 56.54 | 27 | 36 | 218 |
| 25 | Murfreesboro, TN | 56.48 | 68 | 8 | 179 |
| 26 | Waukegan, IL | 56.23 | 96 | 50 | 43 |
| 27 | Thornton, CO | 56.18 | 144 | 80 | 2 |
| 28 | Naperville, IL | 55.89 | 78 | 126 | 14 |
| 29 | Boca Raton, FL | 55.85 | 159 | 16 | 28 |
| 30 | Springfield, IL | 55.67 | 6 | 136 | 163 |
Note: With the exception of “Total Score,” all of the columns in the table above depict the relative rank of that city, where a rank of 1 represents the best conditions for that metric category.
Ranking by City Size
| Rank (1=Best) | Large Cities (Score) | Rank (1=Best) | Midsize Cities (Score) | Rank (1=Best) | Small Cities (Score) |
|---|---|---|---|---|---|
| 1 | Virginia Beach, VA (59.47) | 1 | Chesapeake, VA (65.15) | 1 | Hampton, VA (60.66) |
| 2 | Tampa, FL (58.12) | 2 | Gilbert, AZ (61.91) | 2 | Surprise, AZ (58.87) |
| 3 | Raleigh, NC (57.55) | 3 | Lincoln, NE (61.29) | 3 | Cedar Rapids, IA (58.28) |
| 4 | Lexington, KY (55.37) | 4 | Cape Coral, FL (61.01) | 4 | Broken Arrow, OK (57.78) |
| 5 | Henderson, NV (55.35) | 5 | Boise, ID (60.68) | 5 | Kenosha, WI (57.37) |
| 6 | Charlotte, NC (55.29) | 6 | Peoria, AZ (59.76) | 6 | Palm Bay, FL (57.16) |
| 7 | Jacksonville, FL (55.09) | 7 | Norfolk, VA (58.97) | 7 | Elgin, IL (56.98) |
| 8 | Las Vegas, NV (54.70) | 8 | Orlando, FL (58.46) | 8 | Joliet, IL (56.90) |
| 9 | Colorado Springs, CO (54.68) | 9 | Chandler, AZ (58.30) | 9 | Murfreesboro, TN (56.48) |
| 10 | Louisville, KY (54.40) | 10 | Scottsdale, AZ (57.40) | 10 | Waukegan, IL (56.23) |
| 11 | Mesa, AZ (53.91) | 11 | Frisco, TX (56.87) | 11 | Thornton, CO (56.18) |
| 12 | Nashville, TN (53.43) | 12 | Newport News, VA (56.60) | 12 | Naperville, IL (55.89) |
| 13 | Columbus, OH (53.19) | 13 | Huntsville, AL (56.54) | 13 | Boca Raton, FL (55.85) |
| 14 | Phoenix, AZ (52.86) | 14 | Cary, NC (55.46) | 14 | Springfield, IL (55.67) |
| 15 | Oklahoma City, OK (52.49) | 15 | Toledo, OH (55.45) | 15 | Charleston, SC (55.63) |
| 16 | Milwaukee, WI (52.06) | 16 | Madison, WI (55.37) | 16 | Davenport, IA (55.16) |
| 17 | Aurora, CO (51.99) | 17 | Aurora, IL (55.07) | 17 | Peoria, IL (55.11) |
| 18 | Atlanta, GA (51.61) | 18 | Overland Park, KS (54.92) | 18 | Greeley, CO (55.02) |
| 19 | Tucson, AZ (51.50) | 19 | Fort Wayne, IN (54.70) | 19 | Green Bay, WI (54.70) |
| 20 | Indianapolis, IN (51.28) | 20 | Salt Lake City, UT (54.66) | 20 | Portsmouth, VA (54.46) |
| 21 | Omaha, NE (50.82) | 21 | Des Moines, IA (54.46) | 21 | Sterling Heights, MI (54.30) |
| 22 | Pittsburgh, PA (50.61) | 22 | Vancouver, WA (54.25) | 22 | Longmont, CO (54.27) |
| 23 | Fort Worth, TX (50.24) | 23 | North Las Vegas, NV (54.01) | 23 | Centennial, CO (54.27) |
| 24 | Cincinnati, OH (50.14) | 24 | Reno, NV (53.92) | 24 | Roseville, CA (54.17) |
| 25 | Denver, CO (49.78) | 25 | Fort Collins, CO (53.27) | 25 | Manchester, NH (54.08) |
| 26 | Cleveland, OH (49.38) | 26 | Port St. Lucie, FL (53.15) | 26 | Arvada, CO (54.06) |
| 27 | Austin, TX (49.27) | 27 | Glendale, AZ (53.13) | 27 | Yuma, AZ (53.94) |
| 28 | Minneapolis, MN (49.21) | 28 | Richmond, VA (53.10) | 28 | Sunrise, FL (53.77) |
| 29 | Tulsa, OK (48.83) | 29 | McKinney, TX (53.02) | 29 | Miramar, FL (53.75) |
| 30 | St. Paul, MN (48.42) | 30 | Augusta, GA (52.96) | 30 | Roanoke, VA (53.63) |
| 31 | Kansas City, MO (48.39) | 31 | Elk Grove, CA (52.81) | 31 | Wilmington, NC (53.62) |
| 32 | Sacramento, CA (47.84) | 32 | Greensboro, NC (52.72) | 32 | Westminster, CO (53.49) |
| 33 | Detroit, MI (47.27) | 33 | Tempe, AZ (52.47) | 33 | Spokane Valley, WA (52.98) |
| 34 | El Paso, TX (46.84) | 34 | Winston-Salem, NC (52.34) | 34 | Allen, TX (52.64) |
| 35 | Bakersfield, CA (46.45) | 35 | Tacoma, WA (51.98) | 35 | Tuscaloosa, AL (52.53) |
| 36 | Arlington, TX (46.35) | 36 | Grand Rapids, MI (51.77) | 36 | Norman, OK (52.46) |
| 37 | Philadelphia, PA (45.85) | 37 | Pembroke Pines, FL (51.56) | 37 | Roswell, GA (52.40) |
| 38 | Riverside, CA (45.12) | 38 | Spokane, WA (51.47) | 38 | Visalia, CA (52.33) |
| 39 | Baltimore, MD (45.05) | 39 | Plano, TX (51.42) | 39 | Lakeland, FL (51.96) |
| 40 | Seattle, WA (45.00) | 40 | Knoxville, TN (51.31) | 40 | Davie, FL (51.85) |
| 41 | Fresno, CA (44.97) | 41 | Rochester, NY (51.28) | 41 | Denton, TX (51.84) |
| 42 | Chicago, IL (44.77) | 42 | Tallahassee, FL (50.69) | 42 | High Point, NC (51.63) |
| 43 | San Antonio, TX (44.56) | 43 | Durham, NC (50.58) | 43 | Fort Smith, AR (51.62) |
| 44 | Portland, OR (44.26) | 44 | Laredo, TX (50.21) | 44 | Livonia, MI (51.60) |
| 45 | Wichita, KS (43.96) | 45 | Columbus, GA (50.09) | 45 | Clovis, CA (51.48) |
| 46 | Corpus Christi, TX (43.25) | 46 | Grand Prairie, TX (50.02) | 46 | Dearborn, MI (51.38) |
| 47 | Memphis, TN (43.14) | 47 | Lakewood, CO (49.90) | 47 | North Charleston, SC (51.36) |
| 48 | Houston, TX (42.42) | 48 | St. Petersburg, FL (49.55) | 48 | Temecula, CA (51.32) |
| 49 | St. Louis, MO (42.12) | 49 | Alexandria, VA (49.55) | 49 | Yakima, WA (51.23) |
| 50 | Dallas, TX (41.71) | 50 | Garland, TX (49.24) | 50 | Warren, MI (51.23) |
| 51 | Miami, FL (41.24) | 51 | Buffalo, NY (49.22) | 51 | Vacaville, CA (51.10) |
| 52 | Albuquerque, NM (40.04) | 52 | Akron, OH (48.76) | 52 | Pueblo, CO (51.08) |
| 53 | Santa Ana, CA (39.80) | 53 | Salem, OR (48.71) | 53 | Plantation, FL (51.03) |
| 54 | Anaheim, CA (39.69) | 54 | Hollywood, FL (48.43) | 54 | Sandy Springs, GA (50.80) |
| 55 | Stockton, CA (39.49) | 55 | Modesto, CA (48.15) | 55 | Hillsboro, OR (50.74) |
| 56 | San Diego, CA (38.99) | 56 | Fayetteville, NC (48.13) | 56 | Rockford, IL (50.71) |
| 57 | Honolulu, HI (38.72) | 57 | Moreno Valley, CA (48.01) | 57 | Victorville, CA (50.67) |
| 58 | San Jose, CA (37.29) | 58 | Fontana, CA (47.83) | 58 | Clearwater, FL (50.60) |
| 59 | Washington, DC (36.36) | 59 | Corona, CA (47.05) | 59 | Federal Way, WA (50.44) |
| 60 | New Orleans, LA (35.50) | 60 | Palmdale, CA (46.90) | 60 | Savannah, GA (50.00) |
| 61 | Long Beach, CA (35.14) | 61 | Birmingham, AL (46.63) | 61 | Miami Gardens, FL (49.92) |
| 62 | New York, NY (34.81) | 62 | Lancaster, CA (46.63) | 62 | West Palm Beach, FL (49.78) |
| 63 | Boston, MA (34.20) | 63 | Irvine, CA (46.62) | 63 | Kent, WA (49.60) |
| 64 | Los Angeles, CA (31.77) | 64 | Ontario, CA (46.61) | 64 | Coral Springs, FL (49.47) |
| 65 | San Francisco, CA (29.38) | 65 | Amarillo, TX (46.51) | 65 | Flint, MI (49.22) |
| 66 | Oakland, CA (29.10) | 66 | Hialeah, FL (46.31) | 66 | Allentown, PA (48.93) |
| Info | 67 | Santa Clarita, CA (46.28) | 67 | Everett, WA (48.89) | |
| Info | 68 | Mobile, AL (46.23) | 68 | Beaverton, OR (48.85) | |
| Info | 69 | Rancho Cucamonga, CA (46.04) | 69 | Murrieta, CA (48.68) | |
| Info | 70 | Springfield, MA (45.96) | 70 | Renton, WA (48.68) | |
| Info | 71 | Irving, TX (45.57) | 71 | Athens-Clarke, GA (48.63) | |
| Info | 72 | Little Rock, AR (45.50) | 72 | Erie, PA (48.45) | |
| Info | 73 | Jersey City, NJ (45.12) | 73 | Pompano Beach, FL (48.43) | |
| Info | 74 | Montgomery, AL (44.94) | 74 | Dayton, OH (48.03) | |
| Info | 75 | Jackson, MS (44.89) | 75 | Richardson, TX (47.33) | |
| Info | 76 | Worcester, MA (44.14) | 76 | Mesquite, TX (47.16) | |
| Info | 77 | Fort Lauderdale, FL (43.89) | 77 | Antioch, CA (46.99) | |
| Info | 78 | Eugene, OR (43.76) | 78 | Carrollton, TX (46.85) | |
| Info | 79 | Pomona, CA (43.54) | 79 | Fairfield, CA (46.63) | |
| Info | 80 | Santa Rosa, CA (43.00) | 80 | Bellevue, WA (46.52) | |
| Info | 81 | Oxnard, CA (42.92) | 81 | Rialto, CA (46.05) | |
| Info | 82 | Springfield, MO (42.85) | 82 | Santa Maria, CA (45.81) | |
| Info | 83 | Chula Vista, CA (42.52) | 83 | Brockton, MA (45.66) | |
| Info | 84 | Yonkers, NY (42.09) | 84 | Lowell, MA (45.53) | |
| Info | 85 | Hayward, CA (41.97) | 85 | Mission Viejo, CA (45.16) | |
| Info | 86 | San Bernardino, CA (41.43) | 86 | Simi Valley, CA (45.09) | |
| Info | 87 | Shreveport, LA (40.92) | 87 | Chico, CA (44.88) | |
| Info | 88 | Oceanside, CA (40.74) | 88 | Gresham, OR (44.41) | |
| Info | 89 | Escondido, CA (40.66) | 89 | Fall River, MA (44.22) | |
| Info | 90 | Anchorage, AK (40.61) | 90 | Ann Arbor, MI (43.96) | |
| Info | 91 | Providence, RI (40.59) | 91 | Carson, CA (43.96) | |
| Info | 92 | Fremont, CA (39.90) | 92 | Stamford, CT (43.87) | |
| Info | 93 | Baton Rouge, LA (39.77) | 93 | New Bedford, MA (43.69) | |
| Info | 94 | Newark, NJ (39.59) | 94 | Lansing, MI (43.48) | |
| Info | 95 | Garden Grove, CA (39.08) | 95 | Norwalk, CA (43.46) | |
| Info | 96 | Huntington Beach, CA (39.07) | 96 | Vallejo, CA (43.45) | |
| Info | 97 | Salinas, CA (37.28) | 97 | West Covina, CA (43.31) | |
| Info | 98 | Sunnyvale, CA (36.65) | 98 | Gainesville, FL (42.97) | |
| Info | 99 | Glendale, CA (33.78) | 99 | Orange, CA (42.95) | |
| Info | Info | 100 | Hartford, CT (42.76) | ||
| Info | Info | 101 | Quincy, MA (42.69) | ||
| Info | Info | 102 | Paterson, NJ (42.48) | ||
| Info | Info | 103 | Concord, CA (41.72) | ||
| Info | Info | 104 | Downey, CA (41.60) | ||
| Info | Info | 105 | Carlsbad, CA (41.13) | ||
| Info | Info | 106 | Thousand Oaks, CA (41.09) | ||
| Info | Info | 107 | Lynn, MA (41.02) | ||
| Info | Info | 108 | Albany, NY (40.90) | ||
| Info | Info | 109 | Elizabeth, NJ (40.81) | ||
| Info | Info | 110 | Waterbury, CT (40.71) | ||
| Info | Info | 111 | Fullerton, CA (40.67) | ||
| Info | Info | 112 | Boulder, CO (40.02) | ||
| Info | Info | 113 | Ventura, CA (39.87) | ||
| Info | Info | 114 | Vista, CA (39.80) | ||
| Info | Info | 115 | Bridgeport, CT (39.18) | ||
| Info | Info | 116 | New Haven, CT (38.98) | ||
| Info | Info | 117 | South Gate, CA (38.51) | ||
| Info | Info | 118 | Compton, CA (38.41) | ||
| Info | Info | 119 | El Cajon, CA (38.24) | ||
| Info | Info | 120 | Torrance, CA (38.15) | ||
| Info | Info | 121 | Richmond, CA (37.67) | ||
| Info | Info | 122 | Costa Mesa, CA (37.61) | ||
| Info | Info | 123 | El Monte, CA (36.05) | ||
| Info | Info | 124 | Westminster, CA (35.77) | ||
| Info | Info | 125 | Inglewood, CA (35.48) | ||
| Info | Info | 126 | Miami Beach, FL (35.15) | ||
| Info | Info | 127 | Cambridge, MA (35.05) | ||
| Info | Info | 128 | Pasadena, CA (34.92) | ||
| Info | Info | 129 | Santa Clara, CA (34.57) | ||
| Info | Info | 130 | Daly City, CA (34.53) | ||
| Info | Info | 131 | Burbank, CA (33.87) | ||
| Info | Info | 132 | Santa Barbara, CA (33.24) | ||
| Info | Info | 133 | San Mateo, CA (33.20) | ||
| Info | Info | 134 | Santa Monica, CA (31.28) | ||
| Info | Info | 135 | Berkeley, CA (28.56) |
Ask the Experts
Purchasing real estate for the first time can be a scary experience for many consumers. But it doesn’t have to be. For advice and insight, we asked a panel of experts to share their thoughts on the following key questions:
- What should first-time home buyers consider when choosing a neighborhood?
- How do you know that you are financially ready to buy your first home?
- What do you recommend as the minimum down payment for a first-time home buyer?
- In what ways has the COVID-19 pandemic changed the home-buying process? Will there be any long-lasting effects of the current economic downturn that first-time buyers should consider?
- How can federal, state and local policymakers responsibly and effectively increase home affordability, particularly for first-time home buyers?
Ask the Experts
- Michael J. Seiler
Visiting Scholar, University of Cambridge and J. Edward Zollinger Endowed Chair Professor of Real Estate & Finance – College of William & Mary
Read More
- Gin Starling McPhail
Realtor/Associate Broker; Lecturer, Department of Finance, Parker College of Business – Georgia Southern University
Read More
- John H. Vogel
Adjunct Professor of Business Administration, Tuck School of Business – Dartmouth College
Read More
- Patricia A Ryan
Ph.D., Associate Professor, Finance and Real Estate, Academic Department; Daniels Ethics Fellow, Zayo Undergraduate Teaching Fellow, College of Business – Colorado State University
Read More
- Ran Lu-Andrews
Ph.D., CFA – Assistant Professor of Finance; Program Director, Undergraduate Business Administration Program, School of Management – California Lutheran University
Read More
- Vaneesha Boney Dutra
Ph.D., Associate Professor of Finance, Daniels College of Business – University of Denver
Read More
More Experts
Methodology
To determine the most favorable housing markets for first-time home buyers, WalletHub compared a sample of 300 U.S. cities (varying in size) across three key dimensions: 1) Affordability, 2) Real-Estate Market and 3) Quality of Life.
We evaluated those dimensions using 22 relevant metrics, which are listed below with their corresponding weights. Each metric was graded on a 100-point scale, with a score of 100 representing the most favorable conditions for first-time home buyers. Data for metrics marked with an asterisk (*) were available at the state level only.
Finally, we determined each city’s weighted average across all metrics to calculate its overall score and used the resulting scores to rank-order our sample. Our sample considers only the city proper in each case and excludes cities in the surrounding metro area. Each city was categorized according to the following population-size guidelines:
- Large cities: More than 300,000 people
- Midsize cities: 150,000 to 300,000 people
- Small cities: Fewer than 150,000 people
Affordability – Total Points: 33.33
- Housing Affordability: Triple Weight (~14.28 Points)
Note: This metric was calculated as follows: Median House Price / Median Annual Household Income. - Average Cost of Homeowner’s Insurance*: Full Weight (~4.76 Points)
- Cost of Living: Full Weight (~4.76 Points)
- Cost per Square Foot: Full Weight (~4.76 Points)
Note: This metric measures specifically the median list price per average home square footage. - Real-Estate Tax Rate: Full Weight (~4.76 Points)
Real-Estate Market – Total Points: 33.33
- Rent-to-Price-Ratio: Double Weight (~6.06 Points)
- Median Days on the Market: Full Weight (~3.03 Points)
- Median Home-Price Appreciation: Double Weight (~6.06 Points)
- Foreclosure Rate: Full Weight (~3.03 Points)
- Share of Housing Units Built between 2010 and 2019: Full Weight (~3.03 Points)
- Building-Permit Activity: Full Weight (~3.03 Points)
Note: This metric measures the number of unit permits pulled per 1,000 residents. - Mortgage Lenders per Capita: Full Weight (~3.03 Points)
- Real Estate Agents per Capita: Full Weight (~3.03 Points)
- Homeownership Rate for Millennials: Full Weight (~3.03 Points)
Quality of Life – Total Points: 33.33
- WalletHub’s “States that are Recovering the Quickest from COVID-19” Score: Triple Weight (~9.09 Points)
Note: This metric in based on WalletHub’s “States that are Recovering the Quickest from COVID-19” ranking. - Weather: Full Weight (~3.03 Points)
Note: This metric is based on WalletHub’s “Cities with the Best & Worst Weather” ranking. - Quality of School System*: Double Weight (~6.06 Points)
Note: This metric is based on WalletHub’s “States with the Best & Worst School Systems” ranking. - Driver-Friendliness: Full Weight (~3.03 Points)
Note: This metric is based on WalletHub’s “Best & Worst Cities to Drive in” ranking. - Job Market: Full Weight (~3.03 Points)
Note: This metric is based on WalletHub’s “Best & Worst Cities for Jobs” ranking. - Total Home-Energy Cost: Full Weight (~3.03 Points)
- Violent-Crime Rate: Full Weight (~3.03 Points)
- Property-Crime Rate: Full Weight (~3.03 Points)
Sources: Data used to create this ranking were collected from the U.S. Census Bureau, Bureau of Labor Statistics, Council for Community and Economic Research, U.S. Department of Housing and Urban Development, Zillow, Federal Bureau of Investigation, Insurance Information Institute, AreaVibes, Renwood RealtyTrac, the National Association of Realtors and WalletHub research.