Why Buying a First Home Feels Harder Today, and What That Really Means Here in the Bay Area
If you have a son, daughter, or grandchild who has talked to you about wanting to buy a home but feeling like the math just doesn't work, you are not imagining that things have changed. A recent piece I came across made the national picture clear: there are now 242 cities across the country where a starter home costs a million dollars or more, up from just 80 before the pandemic. That is not a small shift. It is a fundamental change in what "starter home" even means for a lot of young buyers.
The national story: prices and rates squeezing from both sides
The article laid out something I see in my own conversations with clients all the time. Today's buyers are getting squeezed from two directions at once. Home prices have climbed steadily, and at the same time, mortgage rates sitting around 6% feel shocking to anyone who bought or refinanced during the ultra low rate years after the last financial crisis. Add in rising property taxes, insurance premiums, and everyday costs like childcare and student loans, and it becomes much harder to save for a down payment in the first place, let alone comfortably carry a mortgage once you have one.
Here is some helpful context though. Rates near 6% are not actually unusual by historical standards. Rates in the 9% to 10% range were common decades ago, and anything above 5% was considered normal for a long stretch of time. What feels painful right now is less about rates being high and more about buyers being anchored to a brief period of unusually cheap money. That is worth remembering if you are waiting for rates to drop back to 3% before making a move. That may not happen, and waiting has its own cost.
What this looks like in Contra Costa and Alameda counties
The national numbers are sobering, but our local market has its own personality, and it is worth understanding city by city.
In Contra Costa County, places like Walnut Creek, Danville, and Blackhawk have long carried premium price tags, and that has not changed. But there is still real opportunity in Concord, Pleasant Hill, Martinez, Hercules, and Pinole, where buyers can find meaningfully more home for their money while still enjoying easy access to BART, good schools, and that East Bay quality of life. San Ramon continues to be a strong pick for families who want newer construction and top rated schools, even though it commands a higher price point than its neighbors to the north.
Alameda County tells a similar story. Fremont, Dublin, and Pleasanton remain competitive and desirable, particularly for buyers drawn to the Tri-Valley's schools and commute access to the South Bay tech corridor. Livermore, on the other hand, often offers a bit more breathing room on price while still delivering that same East Bay charm, wine country nearby, and a genuine sense of community.
The point is this. Even inside a challenging national affordability picture, the Bay Area is not one single market. It is dozens of smaller markets stacked next to each other, each with its own price point, and that means there is very likely a path to ownership somewhere in our region that fits a buyer's budget, even if their first choice city does not.
Why I still encourage buyers to take the leap
I have spent my career watching families build wealth through two main paths: the equity they build in their home as they pay down their mortgage and as values rise over time, and the steady contributions they make to retirement accounts over the years. Delaying that first step onto the property ladder by five or ten years does not just delay a purchase. It delays the compounding that makes home equity such a powerful wealth building tool in the first place.
If you are a parent or grandparent reading this, and you have already reached your own retirement goals, this may be a moment to consider whether helping a younger family member with a down payment or closing costs could open a door that otherwise feels closed to them. I have seen this kind of support change the entire trajectory of a young family's financial future, and it is a conversation worth having with your financial planner if it feels like the right fit for your situation.
For the first-time buyers themselves, my advice has not changed in 40 years. The perfect moment rarely arrives on its own. But a good home, in the right neighborhood, at a payment you can sustain, is worth pursuing now rather than waiting for conditions that may never feel exactly right. If you are trying to figure out where that fits for you in Contra Costa or Alameda County, I would be glad to help you think it through.
