First-Time Buyers Are Back:

Here's What's Actually Happening in Orange County

After sitting on the sidelines for nearly three years, first-time buyers are cautiously stepping back into the Orange County real estate market. If you've been waiting for your moment to buy your first home—or if you gave up in frustration during the 2021-2022 frenzy—here's the reality check: the landscape has shifted, and there's finally room for you at the table again. Let me break down what's actually happening on the ground and what it means for you. Prefer to listen? Stream The Five-Minute Real Estate Fix episode on this topic below:

Why First-Time Buyers Disappeared

From mid-2020 through early 2023, first-time buyers got crushed. Bidding wars with no contingencies. All-cash investors and deep-pocketed move-up buyers were waiving inspections like they were optional paperwork. Prices that climbed faster than incomes—the median home price in Cypress jumped over 30% in 18 months while salaries stayed flat. The result? First-time buyers—who should represent 30–40% of the market—dropped to barely 25% of transactions. Many just gave up and kept renting.

What Changed: Why 2025-2026 Is Different

We're not back to 2019, but we're also not in the chaos of 2021. Here's what shifted: Mortgage rates have stabilized. Rates are hovering around 6-6.25% for well-qualified buyers. That's not the 3% dream of 2020-2021, but it's also not the 7.5% nightmare we saw in late 2023. More importantly, rates have stayed relatively steady for several months, which means you can actually plan a budget without it changing every week. What this means: A $1,000,000 home with 10% down at 6.125% gives you a monthly payment of around $5,469 (principal and interest). Is it higher than three or four years ago? Yes. But it's predictable, and predictable lets you move forward with confidence. Inventory is no longer at emergency lows. In 2021, Cypress had weeks where only 8-12 homes were for sale. Today? We're seeing 30-45 active listings at any given time across Cypress, with similar increases in Buena Park, Anaheim, and La Palma. That's still a competitive market, but it's not a scarcity panic. What this means: You have time to look, compare, and make an informed decision. You don't need to write an offer on the first house you tour. Sellers are being more realistic. The days of "list it high and let the market bid it higher" are over. Overpriced homes are sitting for 45-60 days and then getting price reductions. Well-priced homes are still moving in 15-30 days, but sellers know they can't play games anymore. What this means: Your offer with an FHA loan and 3.5% down isn't automatically getting tossed in the trash. Sellers are evaluating all offers, especially if you're pre-approved and can close on time.

Where First-Time Buyers Are Actually Succeeding Right Now

Let's talk specifics, because "Orange County" is too broad to be useful. Buena Park: The Value Play The median home price in Buena Park sits around $950,000 for single-family homes, with condos and townhomes in the $675,000 range. That's $100,000-$200,000 less than comparable properties in Cypress or La Palma. What you get: Access to good schools (Buena Park School District, ABC Unified in some areas), proximity to everything (15 minutes to Disneyland, 20 minutes to the beach), and neighborhoods like the San tract and Los tract that offer solid starter homes. The catch: You're competing with investors who see the same value play you do. But many of these investors are pickier now—they need to make the numbers work, which gives you an edge if you're willing to live in the home and handle minor updates over time. Anaheim: The Neighborhood Matters More Than Ever Anaheim is massive, and generalizing doesn't help anyone. But there are pockets where first-time buyers are finding opportunity:

• West Anaheim near the Cypress border: Homes in the $900,000 range with access to great schools
• Central Anaheim, think Lincoln and Brookhurst: Smaller 3-bedroom homes in the sub-$900,000 range, often with larger lots

What you get: Variety. Anaheim has everything from mid-century ranches to newer construction townhomes. The key is knowing which neighborhoods offer long-term value versus which are just cheaper for a reason. La Palma and Cypress: Still Possible, But Harder The median in Cypress for a single family home is around $1,150,000, and La Palma is similar. That's tough for most first-time buyers, but here's where we're seeing it work:

• Condos and townhomes in the $700,000-$800,000 range (places like Tanglewood, Cypress Village, or smaller other communities nearby)
• Fixer-uppers that scare off other buyers—if you're handy or have family who can help with updates, homes needing cosmetic work are sitting longer

What you get: Top-rated schools (Oxford Academy in Cypress ranks 19th nationally and 2nd in California), low crime, and a family-oriented community feel that's hard to beat. You're paying for stability and quality of life. Don't Sleep on Los Alamitos and Rossmoor Los Alamitos can run $1,100,000+, but the Rossmoor area (technically unincorporated Orange County) offers condos and townhomes in the $500,000-$700,000 range. You get Los Alamitos Unified schools, access to the same amenities, and a tight-knit community with excellent resale potential when you're ready to move up.

The Financing Side: What's Actually Working

FHA Loans Are Back in Play 3.5% down payment minimum, credit scores as low as 580 (though 620+ gets you better rates), and mortgage insurance required. In 2021-2022, FHA offers got rejected constantly because sellers had 15 all-cash offers to choose from. Today, we're seeing FHA-financed buyers win deals regularly, especially in Buena Park and parts of Anaheim where investors are less dominant. The catch: FHA appraisals are strict. If the home has peeling paint, broken windows, or safety issues, the appraiser will flag it and the seller has to fix it before closing. Choose your targets wisely. Conventional Loans with 3-5% Down This is the sweet spot for many first-time buyers. You avoid the stigma some sellers attach to FHA loans, you have more flexibility in property condition, and you can often negotiate PMI removal once you hit 20% equity through appreciation or paying down the loan. The catch: You need better credit (usually 680+) and lower debt-to-income ratios than FHA. If your credit is marginal, FHA might be the better path. Down Payment Assistance Programs Orange County and California offer various programs—CalHFA provides down payment assistance loans up to 3.5% of the purchase price, and there are county and city programs often tied to income limits and first-time buyer status. My recommendation: Talk to a lender who specializes in these programs, and we have referrals to a number of trusted lenders locally. Not all loan officers are well-versed in the details, and you don't want to find out about restrictions after you've found your dream home.

How to Compete with Investors Who Never Left

Here's what you need to understand: the investors who were buying everything in 2021 are still here, they're just pickier. They're focused on properties they can rent immediately, deals they can improve and flip, and long-term cash flow opportunities where the math works. How you compete: Get fully pre-approved (not just pre-qualified). A pre-qualification letter is worthless. A full pre-approval where the lender has verified your income, assets, and credit is what gets you taken seriously. Be flexible on closing timeline. Investors often want to close fast. You can't beat them on cash, but you might be able to offer a seller a 45-day close if they need time to find their next place. Write a strong offer on day one. In a competitive situation, you might not get a second chance. If you love the house, your first offer needs to be your best offer. That doesn't mean overpaying, but it does mean offering clean terms—minimal contingencies, strong earnest money deposit, and a realistic price based on comparable sales. Consider properties that scare off investors. Homes in HOAs with special assessments or high dues, properties that need owner-occupant work like cosmetic updates, and homes with layouts that don't rent well—these "flaws" might not matter to you at all if you're buying to live there. That's your competitive edge.

Your Action Plan

If you're a first-time buyer who's been waiting on the sidelines, here's what to do right now: Get your financial house in order. Check your credit scores, save aggressively, pay down high-interest debt, and don't make big purchases. That new car can wait until after you close on your home. Talk to a lender. Schedule a consultation with a local mortgage lender and ask: What loan programs do I qualify for? What's my realistic price range? Are there down payment assistance programs I should consider? Define your must-haves versus nice-to-haves. You're not getting everything on your wish list as a first-time buyer. Be honest about what you actually need: 3 bedrooms, safe neighborhood, access to good schools, reasonable commute. The nice-to-haves can come later when you move up. Find an agent who gets it. You need someone who understands the first-time buyer experience, knows the areas you're considering inside and out, and will fight for you in negotiations without letting emotions take over. Click here to reach out for a confidential conversation about your goals. Start looking and learning. Tour homes. Even if you're not ready to buy for another 3-6 months, start looking now. You'll learn what $800,000 gets you in Buena Park versus Cypress. You'll get comfortable with the process.

The Bottom Line

The insanity of 2021-2022 is over. The panic of 2023's rate spike is behind us. We're in a market where first-time buyers can compete again, but only if you're informed, prepared, and working with people who know what they're doing. Is it harder than it was in 2019? Yes. Is it easier than it was in 2021? Absolutely. You don't need rock-bottom rates or a market crash to buy your first home. You need clarity on your finances, realistic expectations, and a solid team in your corner. If you're thinking about buying your first home in Buena Park, Anaheim, Cypress, or anywhere across Orange County, reach out. We've helped hundreds of first-time buyers navigate this exact situation, and we'd love to help you figure out if now is your time.