Shifting Landscape of Starter Homes: Opportunities and Challenges
WHO:
Fast Company - Realtor.com, a real estate listing website, conducted the report on starter homes.
Fast Company - Hannah Jones, Senior Economist at Realtor.com, provided insights on the housing market.
WHAT:
Fox Business - The cost of a typical starter home has risen from $256,000 in 2019 to $344,000.
Fox Business - The share of affordable listings priced under $350,000 has fallen from 55% to 37.6% since 2019.
Fox Business - The average age of the first-time homebuyer has risen to 40 years old.
Fox Business - The share of first-time buyers was 30% a year ago and has recovered to 35% in May.
Fox Business - Prices in the Midwest have increased by 10% since 2022, while prices in the Northeast have risen by 12.6% since 2022.
Fast Company - The percentage of listings under $350,000 has decreased from roughly 55% in the summer of 2019 to just 37.6% now.
Fast Company - In the West, starter home listings have dropped by 7% since the high price mark in 2022.
Fast Company - The income needed to afford a typical starter home has surged by approximately $35,000 since 2019, now requiring a household income of around $78,000.
Fast Company - The report indicates there are around 300,000 fewer homes listed under $350,000 compared to the summer of 2019.
Fast Company - Approximately 220,000 more starter homes priced below $350,000 have been added to the market since 2022.
Fast Company - In the South, 170,000 starter homes have been constructed since 2022, improving options for buyers and prices by around 3.5%.
Fast Company - Starter home prices have risen by 44.5% for average two-bedroom homes since 2019, compared to a 36.9% increase for four-bedroom homes.
Fast Company - First-time buyers now require a household income of around $78,000 to afford the average starter home.
WHERE:
Fox Business - Builders in Texas, Florida, and the Carolinas have driven the South's recovery by bringing supply to market.
Fast Company - The Northeast is noted as the "toughest market in the country" for first-time buyers, with smaller, more affordable homes becoming scarcer than ever.
Fast Company - The report highlights that the South and West regions of the U.S. are seeing improvements in starter home availability.
Fast Company - Cities mentioned include Denver, Colorado Springs, and Phoenix in the West, while the Northeast is noted as the "toughest market in the country" for first-time buyers.
WHEN:
Fast Company - The peak of the starter home shortage occurred in 2022.
Fast Company - The report notes that the construction of new starter homes began in 2022.
WHY:
Fast Company - The median national household income has risen by 28% since 2019, which is not keeping pace with the rising cost of living.
Fast Company - The shortage of starter homes peaked due to a pandemic rush to buy homes with record low interest rates.
Fast Company - Higher interest rates have kept homeowners from moving, contributing to the supply issues in the market.
HOW:
Fox Business - Almost 70% of outstanding mortgages are at 5% or below, contributing to the lock-in effect in the housing market.
Fast Company - The report indicates that life events such as new jobs, divorces, and retirements are gradually forcing homeowners to move, which is slowly increasing supply in the market.
(UPDATED July 21, 2026 01:24 UTC)
The cost of a typical starter home has surged from $256,000 in 2019 to $344,000, while the share of affordable listings priced under $350,000 has dropped significantly from 55% to 37.6%. The average age of first-time homebuyers has now reached 40 years old, although their share in the market has seen a slight recovery from 30% to 35% in May. Builders in Texas, Florida, and the Carolinas are helping to drive the South's recovery by increasing supply, as nearly 70% of outstanding mortgages remain at 5% or below, creating a lock-in effect in the housing market.
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(UPDATED July 20, 2026 22:23 UTC)
The percentage of home listings priced under $350,000 has plummeted from about 55% in the summer of 2019 to just 37.6% today, making it increasingly difficult for first-time buyers to find affordable options. In the Northeast, which is considered the toughest market in the country for these buyers, smaller and more affordable homes are becoming scarcer, while the income needed to afford a typical starter home has surged by roughly $35,000 since 2019, now requiring around $78,000. Although the median national household income has increased by 28% since 2019, it has not kept pace with the rising cost of living, further complicating the housing situation for many.
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(UPDATED July 20, 2026 21:24 UTC)
A new report from Realtor.com reveals a significant shortage of starter homes, with about 300,000 fewer listings under $350,000 compared to the summer of 2019, despite the addition of approximately 220,000 new starter homes since 2022. In the South, 170,000 starter homes have been built since 2022, which has improved options for buyers and led to a price increase of around 3.5%, while first-time buyers now need a household income of about $78,000 to afford the average starter home. The report highlights that life events like new jobs and retirements are gradually prompting homeowners to move, which is slowly helping to alleviate the supply issues in the market.