California is last on the List for First-Time Home Buyers
California is ranked as the toughest state in the US for first-time home buyers, who are usually around 18-34 years old.
There are a few reasons why California was reported to be the hardest place for first-time buyers. One of the key reasons is that homes are extremely expensive here, especially in Southern California. The median home price hit $460,000 in February, up from 7% during the same month last year.
Housing costs eat up much of people’s income, with the average in California being 35.2% of income being spent on housing costs.
Another big reason, which we have seen for years now, is that there are not enough houses being built, especially in the starter home market. Builders are continuing to focus on the higher end market.
It’s difficult to save in California for this income bracket, many millennials are renting and the costs of the rental market have skyrocketed the past decade. It’s a rental trap. They continue to rent for a much longer period than average because of the difficulty in saving.
There is still hope however, with many first time home buyer assistance programs available in many municipalities.