Starter-Home Sales Up 4% as Demand for Higher-Priced Options Stumbles

Providence, RI recorded a 25% spike in starter-home sales, leading all major metros. San Antonio recorded the biggest drop (-10%).

The typical U.S. starter home sold for a record $260,508 in August, rising 2.2% from a year earlier as sales continued to outpace those of higher-priced tiers. That's according to a new report from Redfin, the real estate brokerage powered by Rocket. Mid- and high-price home prices grew 1.4% and 2.7% year over year, respectively, to near-record highs of $370,000 and $575,000.

Starter-home sales rise for 12th consecutive month, outpacing other price tiers

Starter-home sales increased 3.8% year over year, rising for the 12th consecutive month to the highest August level in three years.

In comparison, sales of mid-price homes fell 0.6% year over year in July, while high-price homes fell 1.2%. Sales of mid- and high-price homes have declined year over year each month since February.

Pending sales of starter homes are also rising, up 3.1% year over year in August. In comparison, pending sales of mid- and high-price homes fell 0.1% and 0.8% year over year in August, respectively.

Mortgage rates fell to their lowest level in a year in recent weeks, and while they've rebounded slightly since, the improved affordability could draw buyers off the sidelines and lead to more sales in the fall.

"Starter homes are holding up better than other price points because they're the most attainable option in a market where affordability is still stretched," said Redfin Senior Economist Sheharyar Bokhari. "First-time buyers and downsizers alike are competing for the same pool of smaller, less expensive homes, which is keeping demand relatively strong even as higher tiers remain sluggish. For many households, stretching into the mid-tier isn't feasible with high prices and elevated mortgage rates."

David Palmer, a Redfin Premier real estate agent in Seattle, confirmed that first-time buyers are having a tough time right now.

"Starter home prices have climbed so much over the last decade that even with mortgage rates coming down from their peak, affordability is still a huge hurdle," he said. "At the same time, buyers who already own a home have more leverage—they can use the equity they've built to make stronger offers. That means entry-level buyers are often losing out to move-up buyers who have deeper pockets."

Starter-home inventory reaches highest August level since 2016

Starter-home prices are rising at a modest rate despite relatively strong demand because there are a lot of them on the market. Active listings of starter homes are up 16.4% year over year to the highest August level since 2016.

In comparison, active listings of mid- and high-price homes grew 13.4% and 12.5% from a year earlier, respectively.

Inventory growth is slowing, however, with new listings of starter homes ticking up just 0.3% year over year. New listings of mid- and high-price homes both fell 0.8% from a year earlier.

Homes taking roughly the same amount of time to sell across all price tiers

The typical starter home sold in 41 days in August, a week slower than last year, while mid- and high-price homes took 40 and 41 days, respectively.

Just over a third (34.3%) of starter homes went under contract within two weeks in August, similar to homes in mid-price (34.4%) and high-price (32.3%) tiers.

Metro-Level Starter Home Highlights: August 2025

• Prices: The median sale price of starter homes rose most in Milwaukee (14.9% to $218,456), Detroit (13.7% to $98,985) and Pittsburgh (10.3% to $139,337). The largest declines were in San Antonio (-5.5% to $214,493), Austin, TX (-4.5% to $320,107), and Jacksonville, FL (-4.2% to $249,049).
• Sales: Starter home sales increased most in Providence, RI (25.3%), Milwaukee (12%) and Riverside, CA (10.8%). They decreased most in San Antonio (-10%), Miami (-7.3% and San Jose, CA (-5.8%).
• Active listings: The total number of starter homes for sale increased most in Las Vegas (42.9%), Miami (35.8% and Seattle (33.7%). Active listings increased in all the metros we analyzed, but those with the slowest growth were Tampa, FL (2%), San Antonio (2.2%) and Kansas City, MO (3.5%)
• New listings: New listings of starter homes increased most in Newark, NJ (14.8%), Nassau County, NY (10.4%) and New Brunswick, NJ (9.1%). New listings fell most in Jacksonville, FL (-18.9%), Tampa, FL (-17.6%) and San Antonio (-13.7%).
• Speed of sales: Starter homes sold fastest in Indianapolis with a median of 16 days, followed by Seattle (17 days), Warren, MI (20 days) and Kansas City (20 days). They sold slowest in Fort Lauderdale, FL (109 days), West Palm Beach, FL (102 days) and Miami (87 days).

To view the full report, including charts and additional metro-level data, please visit:

https://www.redfin.com/news/starter-home-report-august-2025

About Redfin

Redfin is a technology-driven real estate company with the country's most-visited real estate brokerage website. As part of Rocket Companies (NYSE:RKT), Redfin is creating an integrated homeownership platform from search to close to make the dream of homeownership more affordable and accessible for everyone. Redfin's clients can see homes first with on-demand tours, easily apply for a home loan with Rocket Mortgage, and save thousands in fees while working with a top local agent.

You can find more information about Redfin and get the latest housing market data and research at Redfin.com/news. For more information about Rocket Companies, visit RocketCompanies.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250930346536/en/

Contact Redfin

Redfin Journalist Services:

Kenneth Applewhaite

[email protected]