First-time buyers in US have an uphill task

Homebuyers in the US have plenty to grouse about these days. Prices have climbed steeply in many metro areas, mortgage rates are rising and inventory is thin. But for people looking to purchase their first home, it’s ugly out there.

“Starter homes have become scarcer, pricier, smaller, older and more likely in need of some TLC [tender loving care]” than they were six years ago, the real estate website Trulia reported after analysing housing stock across the country.

Trulia began tracking prices and inventory in 2012. American homes are at their least affordable in the report’s history.

But the median listing price of available starter homes has risen 9.6 per cent in the past year, easily beating out the trade-up and premium categories, while starter-home supply has fallen to a new low this quarter, Trulia reported.

Perhaps the most striking finding is that the buyers with little to pay down are confronted with the least affordable homes. The share of income needed by those in the market for a premium home was 15 per cent, and for a trade-up home 27 per cent. For a starter it was 41 per cent.

Adding insult to injury, the homes aimed at first-time buyers are less likely to be ready for human habitation than others, with fixer-uppers accounting for 11.2 per cent of the category.

They’re about nine years older than they were in 2012, and 2 per cent smaller. On the bright side, 2 per cent isn’t a whole lot smaller.