- U.S. starter home sales increased 3.9% year over year in June 2025.
- Prices for starter homes rose 3.1%, reaching a record $260,000 nationwide.
- Utah aims to build 35,000 starter homes by 2028, easing regulations for condos.
SALT LAKE CITY — Starter homes are hot sellers nationwide.
June, typically the height of the spring housing season, saw sales of homes priced for first-time buyers climb 3.9% year over year, reaching the highest level since the same month in 2023, according to the Seattle-based online brokerage Redfin.
Enough new homeowners made the decision to jump into the market that June marked the 10th month in a row in which home sales rose year over year, despite declining sales in every other price range.
But those starter homes continue to get more expensive.
The price for a typical U.S. starter home hit a record $260,000 in June. That's an increase of 3.1% from June 2024. A starter home is defined by Redfin as selling for up to the country's 35% price percentile.
Other price tiers also had cost increases, but only the nation's most expensive homes saw a bigger percentage increase than starter homes, 4%. Labeled the luxury tier, homes with a median sales price of $1.29 million make up the top 5% price percentile.
The cost of buying a home in what's considered the mid-price tier, with a median price of $370,784, went up in June 2.1% year over year. The cost of the high-price tier, with a median price of $577,117, was 2.7% more expensive.
It's the bottom line driving the increase in starter home sales, Redfin senior economist Sheharyar Bokhari explained in a July 29 post.
"In a market where it's difficult for most Americans to afford a dream home, many are turning toward starter homes," Bokhari said. "They're typically smaller and more modest, but starter homes remain within reach for some buyers who have been priced out of higher tiers."
Redfin labeled the June increase in starter home sales "a bright spot in a sluggish housing market." Across the country, the inventory of starter homes was at the highest level since October 2019, seen as slowing the pace of price increases in recent months.
Among the country's 50 most-populous metropolitan areas, a list that does not include any place in Utah, San Diego had June's biggest year-over-year increase in starter home sales, up 18%, followed by Providence, Rhode Island, up 17.4%, and Sacramento, up 14.3%.
Two Florida metropolitan areas saw the biggest decreases in starter home sales, Fort Lauderdale, down 17.5%, and Miami, down 17.4%. San Antonio had a 9.6% decline in starter home sales, the third-highest drop.
How much more buyers paid in June compared to the same month the previous year varied widely, too, with the median sales price jumping the most in Milwaukee, up 15.3% to $212,918, and dropping the most in San Antonio, down 5.5% to $218,631.
In Utah, Gov. Spencer Cox has been pushing for a year and a half to get another 35,000 starter homes priced at less than $400,000 built in the state by the end of 2028. In May, his office reported just over 5,100 had been delivered to market.
A new Utah initiative to ease regulations to encourage the construction of less expensive "starter condos" is currently in the works. State lawmakers have already passed legislation that opens up a $300 million loan fund for the construction of starter houses to condo projects.
