First-time buyers should start looking now says Trulia

by Steve Randall21 Sep 2017
The spring homebuying season may be long gone but that doesn’t mean first-time buyers should wait another 6 months to start looking.

A report from Trulia looked at the supply of starter, trade-up and premium homes across the 100 largest metros and found that starter homes inventory will increase typically around 7% in the fall; while prices decline 4.8% in the winter compared to the spring.

The strongest season for starter homes in 70 of the 100 largest metros is between October and December. Seven of the top 10 metros to see the swing in inventory and prices are in the West, specifically California, Colorado, Oregon and Arizona.

"Starter homebuyers should begin looking now. The fall season provides a great opportunity for finding the right home and neighborhood thanks to a bump in homes for sale on the market, followed by lower winter prices," said Trulia senior economist Cheryl Young.

San Jose has the largest swing in starter homes inventory between the peak of the fourth quarter and the low of the first, at 42%.

Across the 100 largest metros, inventory of starter homes fell 20.4% in the summer of 2017 compared with the same period of 2016; for trade-up homes there was a 12.5% drop; premium inventory slipped just 2.3%.

Affordability continues to worsen with premium buyers needing 14.2% of their income to buy a typical home in the sector compared with 39.7% for start-home buyers and 26% for trade-up buyers.

"Housing markets along the West Coast have long been plagued by tight inventory and worsening affordability. But it's not completely hopeless for would-be homeowners. The seasonal swings in listings and prices in the San Francisco Bay Area, Portland, Ore., and even Phoenix means buyers will likely find more homes for sale at a lower price in the fall and winter months," added Young.

More market update:

Poll

Should CFPB have more supervision over credit agencies?