Over the past several years, it has become increasingly difficult for homebuyers to find a starter home. As home prices have risen across the U.S., starter home prices have also increased, and many repeat buyers have begun purchasing starter homes as other types of housing now sit out of their budget. This trend has challenged first-time buyers, but recent data from real estate marketing platform Realtor.com show that the starter-home market could soon be recovering. 

Starter homes still cost more than they used to, but home-price growth is slowing

Buying a starter home costs much more than it did in 2019, growing from $256,000 to $344,000 nationwide. Additionally, there are roughly 300,000 fewer affordable listings on the market today than before the pandemic.

However, there has been a little bit of reprieve in recent years. Since 2022, the share of starter homes on the maket has increased by 220,000 homes, and prices for starter homes fell by 4.2% in the same time frame.

Buyers seeking out starter homes may have better luck in Southern and Western states

The South is the most promising region for starter homes, according to the report. The typical starter home threshold in the South peaked at $322,600 in 2022, a 36.3% increase from the $236,720 typical price recorded before the pandemic. Since then it has pulled back to $311,200.

The West is also showing some promising signs for first-time buyers. At the peak of the pandemic frenzy in 2022, the starter-home threshold in the West hit $517,600, which is 40.7% above its pre-pandemic level of $367,920. Since then, however, prices have come down. The 2026 starter-home threshold in the West stands at $480,000, a 7.3% decline from the 2022 peak and the largest pullback recorded by any region.

Meanwhile, the Midwest and Northeast are lacking in starter-home supply

The Northeast has traditionally been home to more expensive markets, and a lack of new housing supply to the region hasn’t helped. The starter-home threshold in the Northeast reached $443,600 in 2026, nearly 50% above its pre-pandemic level of $296,000.

While affordable overall, starter home prices in the Midwest are also rising. The Midwest has a median listing price of $329,900 and a starter-home threshold of $263,920 in 2026, making it the closest to the national starter-home threshold of any region. However, prices for starter homes in the region rose by 37.5% between 2019 and 2026.