When we set out to explore what first-time homebuyers want in 2025, we expected a long list of must-haves: spacious layouts, modern upgrades, and even backyard amenities. But after speaking with agents and house hunters, the answer was far simpler. They just want a place to call their own.

Not their parents' basement or a pricey rental with no real perks and no equity. They want a home. Maybe not brand new—just a place to call their own.

While affordability may be their top concern, first-time homebuyers are looking for more than a cheap price tag. They want a house that will save them money in the short and long term.

Affordability

Only 24% of homebuyers in 2024 were purchasing their first home, according to the National Association of Realtors®—the lowest percentage on record.

First-time homebuyers have been backed into a tough spot for a while, dealing with rising prices, climbing mortgage rates, low inventory, and fierce competition from downsizing empty nesters with significant equity.

These headwinds have made affordability the primary concern of first-timers in 2025. 

To adjust, first-time buyers are changing their expectations, considering smaller homes, relocating to more affordable markets, or seeking down payment assistance. Programs like FHA loans, first-time buyer grants, and state-level initiatives have become crucial lifelines, helping some navigate the financial hurdles of the current market.

Move-in ready or bust

First-time homebuyers enjoy viewing a home and picturing what life would be like there.

For many newbies, that vision doesn’t include a fixer-upper.

Renovating a home is challenging and comes with its share of hassles. It often requires upfront costs for repairs, and no one enjoys dealing with dust everywhere.

That means first-timers are prioritizing turnkey properties in 2025. Many can’t afford to take on expensive renovations after sinking all their savings into a down payment and closing costs. So buying move-in-ready is less of a preference and more of a necessity.

Modern kitchens, updated bathrooms, and fresh finishes are the green light these buyers are looking for.

Energy efficiency

First-time house hunters tend to be younger than seasoned homebuyers, and their preferences reflect that. As millennials and Gen Z make up a growing market share, they prioritize energy-efficient home upgrades for sustainability and savings.

“Buyers are really into energy-efficient features like smart thermostats, LED lighting, and even solar panels,” says Mike Roberts, a mortgage broker and co-founder of City Creek Mortgage in Utah.

These upgrades aren’t just a matter of taste, they’re also practical.

“They lower utility bills, and they also add a modern touch that resonates with today’s eco-conscious mindset,” says Roberts.

With rising energy costs and tax incentives for green home improvements, first-time buyers see these features as both an investment and a way to reduce monthly expenses. High-efficiency windows, Energy Star–rated appliances, and improved insulation are also becoming key selling points, making move-in-ready homes with these upgrades even more appealing.

Multigenerational homes

As much as first-timers would like a place of their own, few can afford one alone. Starter homes have ballooned in price, making these simple, no-frills homes a relic of a distant past. To compensate, newbie homebuyers are teaming up with their families to buy houses that can comfortably accommodate multiple generations.

In 2024, 17% of home sales were for multigenerational abodes, according to NAR data. As mortgage rates remain stubbornly high, inventory remains constricted, and older generations like boomers stubbornly hang on to $84 trillion of wealth and 38% of current housing stock, we’re likely to see more first-timers partner with equity-rich family members to buy their first home.

Newbie homebuyers are teaming up with their families to buy houses that can comfortably accommodate multiple generations.

What first-timers should be looking for

Understandably, first-time homebuyers are laser-focused on affordability, but they risk getting tunnel vision if they’re not careful.

Even move-in-ready homes can come with costly repairs if buyers don’t know what to look out for.

They’ll notice the roof, but they don’t always remember to check the age of the AC unit or inspect the attic to ensure the wood is in good condition.

To avoid getting stuck with a lemon, do your due diligence before buying. Hire a home inspector to thoroughly inspect the premises, negotiate any necessary repairs with the sellers, look into the HOA to ensure you understand their financial situation and your obligations—and don’t forget to check if the house is vulnerable to natural disasters.

“For any house you are considering buying, you should ask your Realtor® if the home is in a flood zone and if flood insurance is required. You can even check on your state's website yourself for FEMA flood maps,” says Calvo.

Flood insurance costs an average of $1,000 to $2,000 per year, and home insurance premiums can skyrocket after a natural disaster, both of which can take a huge toll on household budgets.

In addition to understanding your home’s flood risk, use FEMA resources to understand your home’s vulnerability to tornadoes, hurricanes, and wildfires.

Haven’t found The One yet? Don’t worry

Home prices are finally cooling, promising an answer to the only thing on first-timers' minds: affordability.

In some areas, the monthly housing supply has doubled compared to last year. Over the past three months, we’ve helped each client save around $10,000 in negotiations, whether by having the seller cover closing costs or lowering the sale price.

While house prices inch down, Roberts recommends using this time to understand your financial comfort zone, get pre-approved for a mortgage, and gather all your necessary paperwork (like recent tax returns, W2s, employment verification letters, etc.). Though prices are softening, competition remains, especially for well-priced homes in desirable neighborhoods.

The shifting market presents an opportunity to first-timers, but you’ll need to be prepared.

Original post courtesy of realtor.com.

Rich Dallas/Sharon Fincham

(c) 412-965-6387

(o) 724-941-3340

The Dallas-Fincham Team and Berkshire Hathaway HomeServices

Rich@DallasFinchamTeam.com

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