By Jorge Casuso

July 16, 2024 -- Santa Monica was ranked the second worst city in the U.S. for first-time home buyers, according to an analysis of 300 cities by WalletHub released Tuesday.

Only Berkeley ranked lower in the yearly report, which ranks cities based on affordability, real estate market and quality of life, according to the report "Best & Worst Cities for First-Time Home Buyers (2024)."

Santa Monica was the least affordable city on the list, followed by Santa Barbara, based largely on median home price as compared to median annual household income.

Other factors that carried less weight when measuring affordability were cost of homeowner's insurance, real estate taxes, cost of living and cost per square foot.

Toledo, Ohio ranked first on the list for affordability, followed by Akron, Ohio and Montgomery, Alabama.

Santa Monica also ranked low for its real estate market, placing 276th based on ten factors, including rent-to-price-ratio and median home-price appreciation, which carried double weight.

The top-ranked real estate markets were in Florida, with Port St. Lucie taking the top spot, followed by Cape Coral and Palm Bay.

When it came to quality of life, Santa Monica fared far better, ranking a still sub-par 188th based on seven factors including quality of its school system, which carried double weight.

Also taken into account were weather, driver friendliness, job market, total home energy cost, violent crime rate and property crime rate, which were weighed separately.

Tampa, Florida ranked first for quality of life, followed by Boca Raton, Florida, while Oakland ranked last.

“Buying a home for the first time is a very stressful and difficult process, especially when housing prices are through the roof and interest rates have risen sharply in the past few years," wrote WalletHub analyst Cassandra Happe.

"The best cities for first-time home buyers not only are affordable both in terms of buying a house and living there afterward, but they also have a lot of housing choices as well as low crime rates and good schools,” Happe said.

Despite the low WalletHub ranking, local real estate professionals say there has been an increased share of first-time home buyers in Santa Monica, where the average median list price is $4.3 million, according to HousingWire.

The increase is due to "having fewer move-up buyers in the market" and down payments made fully or in part with inheritances, according to the site, which provides housing market news, data and rankings.