First-time home buyers faced significant challenges in major U.S. metropolitan areas during Q1 2020, with both affordability and availability presenting substantial hurdles.

In 40% of the largest U.S. metros, list prices exceeded five times the median first-time buyer income. Active listings plummeted 19% compared to Q1 2019, creating a highly competitive market for new buyers.

Key Findings:

• National affordability ratio: 4.5 (meaning homes were listed at 4.5 times the median first-time buyer income)
• Only Pittsburgh had homes priced at the recommended three times income ratio
• 28 metros exceeded the national average affordability ratio
• 10 metros had list prices over six times local first-time buyer income

Price Trends:

• National average list prices rose 4% (inflation-adjusted)
• 39 of 50 largest metros saw price increases
• Los Angeles experienced the highest increase (21%)
• Only Houston, Minneapolis, and Louisville saw price decreases (4%)

Inventory Challenges:

• Active listings fell in 48 of 50 major metros
• 23 metros saw inventory drops exceeding 20%
• Only Minneapolis (+8%) and San Antonio (+3%) showed inventory increases
• Salt Lake City experienced a 40% decrease in listings

Los Angeles Market Spotlight:

• List prices increased 21% to $953,000
• Homes cost approximately 12 times median first-time buyer income
• Active listings decreased 21%

First-time buyers should consider:

• Using home affordability calculators to determine realistic price ranges
• Being prepared for multiple offer situations in competitive markets
• Evaluating income stability before stretching budgets
• Remaining patient in areas with limited inventory

Note: This data predates significant COVID-19 economic impacts, serving as a baseline for future market analysis.

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