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For loan officers, the latest Realtor.com Research read is a reminder that first-time buyer demand may be easier to serve than at the worst point, but the entry-level inventory gap is still real.
Starter homes are showing some signs of relief, but the entry-level market has not healed, according to Realtor.com Research. In an Oct. 8, 2026 report titled “Where Starter Homes Still Exist: A Metro-by-Metro Look,” the research team said the worst of the starter home crunch appears to be behind us, while also noting that the market still has roughly 300,000 fewer affordable listings than before the pandemic.
That matters for mortgage professionals because the first-time buyer conversation is still being shaped by a supply problem, not just rates or borrower qualification. If your pipeline includes renters, newly married buyers, young families, or moderate-income households, this is the inventory backdrop they are walking into: somewhat better than the tightest point, but still meaningfully short of where the market used to be.