In the third quarter of 2021, price growth began to normalize after months of record highs and inventory rose slightly across the nation, but first-time buyers still struggled in a competitive seller’s market, according to NerdWallet. Average quarterly home prices were listed at 5.3 times the median first-time home buyer income, and many inaugural buyers were also priced out of the housing market by older competitors backed by existing equity.
From the second quarter to the third, prices across the largest US metro areas dipped 1%, a difference most buyers likely didn’t even notice, but a decline which nonetheless signals long-awaited price deceleration in a hot market.
Price growth slowed a skosh and inventory ticked up slightly across the nation’s biggest metros in the third quarter. And while many potential first-time buyers have found their savings bolstered during the pandemic, those who haven’t squirreled away a surplus will find these modest improvements underwhelming.
National averages provide a good big-picture look at what’s happening in the housing market, and in the third quarter, that story is a slight improvement over the last: Prices were down a smidgen (1%) and inventory up 22% nationwide, quarter over quarter. But homes were listed at 5.3 times the median first-time home buyer income, when three times your income is a long-standing affordability rule of thumb.
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