For generations, buying a home has been seen as a natural part of life. It was a milestone that represented stability, independence, and starting a family.
Today, that path doesn’t seem as straightforward. Rising home prices, higher mortgage rates, and fewer homes available have made the decision to buy or rent more complicated. For young adults just starting their careers and building their families, homeownership may take more planning than it did for previous generations.
Starter Homes Don’t Have Starter Prices Anymore
Think about the years after college. You’re starting your first full-time job, building your savings, paying bills, and maybe even beginning to think about a family. For many generations, buying a modest starter home was a natural next step, something many people might have even expected to achieve as they began their careers.
But starter homes don’t necessarily come with starter-home prices anymore.
According to Harvard University’s Joint Center for Housing Studies, “since 2020, home prices have increased by 54 percent nationwide1.” In 2025, the median existing single-family home price was nearly five times the median household income.
For someone early in their career, saving for a down payment while managing everyday expenses can be challenging. Even when you’re ready for homeownership, finding a home that fits your budget may take more time than it once did.
Why Aren’t More Homes Coming on the Market?
Home affordability isn’t the only challenge. The number of homes available for sale can also affect how difficult it is for young buyers to find a home that fits their needs and budget.
Some existing homeowners are hesitant to sell because they have mortgage rates that are considerably lower than today’s rates. Homeowners that have rates below 4% may face significantly higher monthly payments if they sell and purchase another home at current rates. As a result, some of the people who might have been considering to downsize, relocate, or move into their “forever home” are choosing to stay put.
Building new homes also presents another challenge. The cost of construction materials and labor has increased significantly in recent years, which is making it more expensive for builders to bring new homes to market. According to Harvard University’s Joint Center for Housing Studies, the price of building materials rose 36% between February 2020 and February 20252. These higher construction costs can make it more difficult to build homes at prices many young, first-time buyers can afford.
In the St. Louis area, a FasterHouse analysis of August 2025 data reported approximately 3,106 single-family homes in inventory, which is down 9.1% from the previous year3. When fewer existing homes are available and new construction remains expensive, first-time buyers may face more competition and fewer options within their budgets.
Buying vs. Renting: What Should You Consider?
Both options come with financial trade-offs. The right choice depends on your budget, lifestyle, and long-term goals.
| Buying makes sense when you: | Renting makes sense when you: |
|---|---|
| Plan to stay in the same area for several years. | Expect your career, location, or family needs to change. |
| Have savings for a down payment, closing costs, and emergencies. | Want flexibility while building savings or pursuing other financial goals. |
| Can afford your mortgage, taxes, insurance, utilities, and ongoing repairs. | Can share housing costs with roommates to save more. |
| Want to build home equity and have more control over your living space. | Prefer not to be directly responsible for many property repairs and maintenance costs, which are generally handled by the landlord when covered by the lease and applicable law. |
Homeownership offers the potential to build equity and long-term stability, but it also comes with maintenance costs and unexpected repairs. Renting offers flexibility and may make it easier to save, but monthly payments do not build ownership equity.
Neither option is automatically the better financial decision. Consider the overall cost of housing, how long you plan to stay, and how each choice fits into your financial plan.
Make the Decision That Fits Your Family
Today’s housing market looks different from the one previous generations experienced. Buying a home can still be an important financial milestone, but renting can also be a practical and positive choice depending on your circumstances.
At Archford, our mission is Taking Care of Families. That means helping families make thoughtful financial decisions based on their goals, priorities, and future.
Whether you’re preparing to buy your first home or deciding whether to keep renting, the goal is to make a decision that supports your financial well-being today and down the road.
Sources:
1Joint Center for Housing Studies of Harvard University. The State of the Nation’s Housing 2026. 2026, https://www.jchs.harvard.edu/state-nations-housing-2026.
2Fleck, Anna. “U.S. Home Prices Are up 29 Percent Since 2019.” Statista, 27 June 2025, https://www.statista.com/chart/34712/change-in-home-prices-in-selected-us-metro-areas/
3“St. Louis Real Estate Market Trends and Statistics.” FasterHouse, https://www.fasterhouse.com/st-louis-real-estate-market-trends-and-statistics/
