California is the worst state for first-time homebuyers — the staggering amount you need to pay

So much for a starter home.

A new analysis from home finance site This First Home found that California is home to some of the worst metro areas in America for first-time homebuyers — with San Jose ranking dead last among 150 major metros.

California is home to some of the worst areas for first-time home buyers. Getty Images

Data showed that just 2.8% buyers in the San Jose-Sunnyvale-Santa Clara metro area got loans from the Federal Housing Administration (FHA), which are often used by first-time homebuyers due to their more forgiving requirements than traditional loans, KTLA reported.

That was the lowest share of first-time homebuyers in the country, according to an analysis of 2025 Home Mortgage Disclosure Act data from the Consumer Financial Protection Bureau.

And the few buyers who do manage to crack into the market need serious cash.

The median income of FHA borrowers in the San Jose metro was $193,500, while the median loan amount was $735,000 and the median property value was $785,000, according to the analysis.

The Los Angeles-Long Beach-Anaheim metro area was not far behind, with FHA loans making up just 11.2% of all home loans, according to This First House.

The median income of FHA borrowers in the LA area was $167,000, with a median loan amount of $665,000 and a median property value of $705,000.

San Francisco-Oakland-Berkeley also landed among the top 10 worst metros for first-time homeowners nationally.

Just 5.8% of all home loans there were FHA loans, while the median FHA borrower income was $169,000 and the median loan amount was $615,000.

Getty Images

Not every California market was completely hopeless for first-time buyers.

Visalia ranked third among the top 10 metros for first-time homebuyers nationally, with FHA loans making up 45.5% of all home loans, according to the report.

Bakersfield-Delano ranked sixth nationally, with FHA loans accounting for 40.3% of all home loans.

But even in more accessible California markets, the price of entry was hardly cheap.

In Visalia, the median income of FHA borrowers was $100,000, with a median loan amount of $375,000.

In Bakersfield-Delano, the median borrower income was $102,000, with a median loan amount of $375,000 and a median property value of $385,000.

Nationally, the best metro area for first-time home buyers was McAllen-Edinburg-Mission, Texas, where FHA loans made up 54.2% of all home loans.

There, the median income of FHA borrowers was $89,000 and the median loan amount was $245,000 — less than half the median income required in San Jose.

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