Today, Neighbors Bank published their list of the Best Cities for First-Time Homebuyers in 2026, showcasing the top 10 American cities where buyers may find steady employment, reasonable monthly payments, and a good standard of living. According to the survey, homeownership is still accessible in mid-sized metropolitan areas, where daily expenses are simpler to handle and housing costs are in line with local salaries, unlike in large coastal cities across the nation.
Note: The rankings were created by Neighbors Bank by examining communities with more than 115,000 residents whose monthly housing expenses remain at or below 35% of the median household income. Crime, employment, commute times, childcare expenses, house appreciation, and entertainment alternatives were among the quality-of-life metrics that were included in the analysis.
The Top 10 list of Best Cities for First-Time Homebuyers for 2026 includes:
- Peoria, IL
- Fort Wayne, IN
- Pittsburgh
- South Bend, IN
- Davenport, Iowa
- Rockford, IL
- Wichita, KS
- Toledo, Ohio
- Lansing, MI
- Wichita Falls, Texas
These markets, which collectively cover the Midwest, the Great Lakes, and portions of the Plains, show a trend toward areas that provide affordability without compromising quality of life. In comparison to more expensive larger coastal metro areas, the list’s shared advantages include cheaper housing costs, quicker commutes, and more stable employment markets.
Davenport, Iowa, and Toledo, Ohio, offer some of the lowest housing cost burdens; while Wichita Falls, Texas, is noteworthy for its unusually cheap entry pricing and commuting times; Rockford, IL, leads the group in recent house price appreciation; and Peoria, IL, is ranked highest overall for affordability and quality of life. When taken as a whole, these markets show that first-time purchasers can still discover ownership routes that strike a balance between initial expenses, recurring payments, and daily livability.
“Affordability was an important factor, but it wasn’t the only thing we looked at,” said Jake Vehige, President of Mortgage Lending at Neighbors Bank. “We focused on places where first-time buyers can afford a home and enjoy a strong quality of life that includes entertainment, reasonable commutes and everyday conveniences. This is proof that you don’t have to live in a major coastal metro to live well in 2026.”
Examining the Top Five Cities for First-Time Homebuyers
1. Peoria, IL
- Median home price: $161,868
- Median monthly housing cost: $1,492
- Housing cost as a percent of income: 25%
Metro highlights: Peoria, IL, which is located along the Illinois River, is at the top of the list because it has the best overall quality-of-life score and some of the lowest housing and living prices. Riverfront attractions such as the Peoria Riverfront Museum, vibrant festivals, and a growing network of parks and trails provide residents with enough opportunities for recreation and community involvement. First-time buyers have a viable route into the market without fierce competition because home values have increased consistently but are still reasonably priced.
2. Fort Wayne, IN
- Median home price: $246,963
- Median monthly housing cost: $1,880
- Housing cost as a percent of income: 33%
Metro highlights: Midwest affordability, a renovated downtown, burgeoning trail systems, and an expanding arts and cultural scene are all combined in Fort Wayne, IN. The Botanical Conservatory, the Fort Wayne Museum of Art, and a vibrant local music and festival calendar are among the attractions that locals take pleasure in. Even though housing costs are at the upper end of the affordability range, continuous house appreciation is supported by a diversified economy that is anchored by businesses in the healthcare, manufacturing, and defense sectors, such as Parkview Health, Lutheran Health Network, and Steel Dynamics. First-time homeowners may stretch their budgets and enjoy a high quality of life thanks to manageable commutes, affordable childcare, and a robust employment market.
3. Pittsburgh
- Median home price: $221,503
- Median monthly housing cost: $1,762
- Housing cost as a percent of income: 29%
Metro highlights: The popular Pittsburgh metro provides first-time buyers with affordable access to a sizable metro with lots of amenities. While foodies profit from a vibrant local eating scene, sports enthusiasts can enjoy the Steelers, Penguins, and Pirates. Stability and consistent job growth are provided by a diversified economy supported by healthcare, education, and technology. In comparison to larger coastal metro areas, home values are still reachable, offering buyers a balance between an urban lifestyle, the possibility of long-term appreciation, and affordable housing costs.
4. South Bend, IN
- Median home price: $221,658
- Median monthly housing cost: $1,738
- Housing cost as a percent of income: 32%
Metro highlights: South Bend, IN, which is anchored by the University of Notre Dame, blends the excitement of a college town with continuous riverfront construction and downtown revitalization. The South Bend Chocolate Company, the Studebaker National Museum, and miles of recreational trails along the St. Joseph River are all accessible to locals. Employers in the fields of education, healthcare, and manufacturing, including AM General, Beacon Health System, and the University of Notre Dame, contribute to the city’s economy. First-time buyers may still afford homes, and South Bend is an appealing choice for families and young professionals due to its short commutes, reasonably priced daycare, and potential for long-term growth.
5. Davenport, Iowa
- Median home price: $183,689
- Median monthly housing cost: $1,680
- Housing cost as a percent of income: 28%
Metro highlights: Davenport, Iowa, which is located along the picturesque Mississippi River, blends developing cultural and recreational activities with historic charm. The city’s short commutes and reasonably priced childcare make daily life easier. Davenport provides long-term job stability because to its diverse economy, which includes firms in the healthcare, manufacturing, and educational sectors including Genesis Health System and Palmer College of Chiropractic. Home values continue to be far lower than the national average, offering buyers a reasonable starting point while maintaining consistent growth.
“These markets may not be on everyone’s radar, but they give first-time buyers a real chance to build equity and financial stability,” Vehige said. “For most looking to enter the housing market, that’s more important than chasing the next hot spot.”
Overall, in 2026, first-time homebuyers will face a changing but “still difficult market,” according to Vehige.
Mortgage rates fell to their lowest point in fourteen months toward the end of 2025, although they are still high by recent historical standards. Property taxes and homeowners insurance premiums are rising nationwide at the same time. Affordability continues to be a major concern for new purchasers, especially first-timers who usually lack equity and finances for down payments and closing fees, when you factor in the ongoing disparity between incomes and property prices.
However, not all aspects of the current market are bleak. As mentioned, compared to big coastal hubs, property prices have stabilized, commutes are tolerable, and cost of living pressures are far lower in many mid-sized urban areas. First-time buyers can discover a practical route to homeownership without compromising quality of life in these pockets of opportunity across the nation.
The post These U.S. Cities Offer First-Time Buyers a Path to Homeownership in 2026 first appeared on The MortgagePoint.
