The Worst U.S. Cities For First-Time Home Buyers: Is Yours One Of Them?

Buying a home can be challenging in any competitive market, but there are certain metro areas that really give first-time home buyers a run for their money, according to a new study by Bankrate.com.

“Young home buyers better be ready to compromise,” said Bankrate data analyst Adrian Garcia. “Affordability and convenience might be the trade-off to moving to a major metro with a little less culture or popularity. Buyers have to find the balance that works for them and their financial situation. Make sure you’re making a sound investment. You can always upgrade later.”

The study reviewed the 50 largest metro areas in the country based on several factors a first-time buyer should consider when purchasing a home, including affordability, job market, market tightness, culture and safety.

“We measured market tightness, the number of days a house sat on the market in 2018 with the idea that the less time a house is on the market the more competition you’re seeing,” said Garcia. “The market is just going to be tight and competitive for a number of buyers.”

California is home to several of the 10 worst metros for first-time buyers that were evaluated, including Los Angeles, Sacramento, San Jose, Riverside-San Bernardino and San Diego.

The ranking was compiled using measures related to affordability, culture, job market, market tightness and safety. Bankrate used the most recently available data for the 50 most populous metropolitan areas.

“Deciding where to take that first job after college can set you in completely different tracks for homeownership,” said Garcia. “First-time buyers should be ready to compromise. Maybe they decide to move farther away to get a more affordable home from the metro they want to live in. Maybe they live in a less popular area. It’s really going to be hard for first-time buyers to find the best spot and the best price for their first home, and they should be ready to face that.”

1. San Francisco reigns as the worst area for first-time home buyers. Buyers in the counties that make up the San Francisco metro area need an annual income of $289,147, on average, to buy the median priced home in their market, according to Attom Data Solutions. The price of housing here makes homeownership unattainable for many prospective first-time buyers. Even in today’s strong job market, 25- to 44-year-olds in this metro area are only earning a median income of $106,151, according to the U.S. Census Bureau.

San Francisco certainly has big city appeal, especially for those looking for diversity, access to the arts and trendy restaurants. But all that comes at a high price for home buyers in the metro area. San Francisco ranked second-to-last for affordability (49) and market tightness (49). The metro’s low score for safety (43) is also concerning. Although San Francisco is booming with culture (9) and the job market ranks in the top-half (24), potential buyers might want to think about a better location for their first home.

A March report by the national rental search site Zumper also shows rental prices are on the rise in San Francisco. March 2019 is expected to be the most expensive month ever for the city’s rental market. One-bedrooms here have reached a peak of $3,690, consistently increasing by at least 3% month over month.

2. Although the Los Angeles metro area scored high for culture and fared well in safety, it received low marks in all other categories.

3. High home prices and tight inventories make the Sacramento, California market challenging for typical first-time buyers.

4. San Jose, California came in last place for affordability and market tightness. “Prospective buyers in the San Jose metro have to be ready with strong credit scores and mortgage applications in order to attain homeownership,” said Garcia. “The area has the tightest housing market out of the 50 major metros we analyzed.”

For-sale homes typically were available on the market for less than a month with a median of 27 days in 2018, according to data from Realtor.com. Nationally, the median days on market for homes on sale was 67 days.

San Jose is also the least affordable based on a look at how much income is needed to buy the median priced home, the property taxes in the area relative to its peers and how many 25- to 44-year-olds were renting versus homeowners. Sixty-two percent of 25- to 44-year-olds are renters in the San Jose metro. Buyers in the counties that make up the San Jose metro need an annual income of $308,178, on average, to buy the median priced home in their market, according to Attom Data Solutions.

5. The Seattle housing market is still tight for many first-time buyers. It’s the only city outside of California to rank inside the bottom five.

“Seattle is a fun place that people would like to move to, but it doesn’t do well with first-time buyers,” said Garcia. “While it does have a strong job market, it has become unattainable for the typical buyer. One area that ranked really well with Seattle was the culture aspect of it, but that’s not enough to overcome the affordability issues.”

6. The Riverside-San Bernardino area in California has the worst job market of all the metro areas in the study. It is also one of the metro areas in the state where a large share of middle-income households struggle to afford their homes.

7. San Diego is a nice place to live, but is it affordable and attainable? “Probably not for many folks based on the study,” Garcia said. “It has some of the same issues as many of the other major metros in California, high home prices and a lack of inventory pricing people out.”

8-10. Las Vegas, Miami and Memphis, Tennessee round out the list of the most challenging cities for first-time home buyers.

This post first appeared on Forbes.com. To see the original, click here.