In July 2024, Zillow reported that in 237 cities, so-called "starter homes" now cost over $1 million. While this data is shocking, it’s also misleading. Just because a home is the least expensive option in a given area doesn’t make it a starter home. At HUTS, we believe a starter home should be affordable for the average starter home family —which we define as a dual-income household earning the local average, with no kids or one young child. For these families, affordability is key and, in very few circumstances, would a million-dollar price tag reflect that.
HUTS takes a fundamentally different approach to affordability. Instead of simply slapping the "starter home" label on any house at the bottom of the market, we ensure that our homes remain within 4x the average dual-income household income in the area. This ensures that first-time buyers, especially young families, can access homes that truly fit their financial reality.
Defining the "Average Family"
When we talk about the average family for The Starter Home, we can’t apply a single, national definition. Instead, we need to come up with a flexible and localized description, taking into consideration local earning trends and local market factors.
Our market includes a family where both adults are working and earning the average income in their region. They likely have no kids or perhaps one young child, which makes them an ideal candidate for The Starter Home. These households often face the biggest challenge in today’s housing market—finding a home that fits their needs and budget without compromising quality or long-term use.
Affordability Beyond Size and Construction
Wee make affordability more than just a number by focusing on two key strategies: home size and construction method. But that’s not the whole story. A unique part of our model is that our clients act as the property developer. In traditional home buying, developers add significant markup, pocketing profits that inflate the final cost to the buyer. By removing this middleman, we allow our clients to take control of the process and cut out the extra costs that drive up housing prices.
This shift in approach not only makes the home-building process more transparent but also drastically reduces the overall cost of the project. HUTS supports clients in this role by providing everything they need—designs, materials, and guidance—to make the transition from buyer to home developer seamless.
The Formula for an Appropriately-Priced Home
We know that affordability isn’t just about building smaller or cheaper homes. It’s about aligning the cost of the home with the reality of what local families can afford. Here’s how we make sure our homes fit the 4x income rule:
- Efficient Design: Our homes focus on functional layouts that minimize waste and maximize livability. By avoiding unnecessary square footage, we keep construction costs down without compromising on comfort.
- Accessible Construction Methods: We use industry-standard construction techniques that local contractors are familiar with, which helps keep labor costs low and allows our homes to be built without the need for specialized or expensive materials.
- No Developer Markup: Perhaps the most significant factor in our homes' affordability is that clients are able to act as their own developer, eliminating the traditional markup that developers charge to make a profit. This puts more control in the hands of the buyer and keeps the overall cost lower than comparable homes in the area.
A Holistic Approach to Affordability
Affordability isn’t just a buzzword—it’s baked into every part of our design and construction process. By combining intelligent use of space, efficient construction methods, and eliminating unnecessary markups, we ensure that The Starter Home stays within reach for the average family in each region. This allows young families to own homes that fit their lifestyle, without sacrificing quality or financial stability.
Why 4x Income is the Key
We’re committed to the principle that a home should never cost more than 4x the average dual-income household income. Why? Because it’s a formula that reflects real-world affordability. By staying within this range, we ensure that buyers can comfortably manage their mortgage payments while still covering other life expenses—whether that’s childcare, transportation, or simply saving for the future.
This isn’t just about making housing "cheaper"—it’s about creating homes that fit within the financial realities of modern families, without burdening them with unmanageable debt or forcing them into homes that are too small or poorly constructed.
Controlling Your Own Outcomes
We are dedicated to bringing sanity back to the housing market, where starter homes are appropriately sized, thoughtfully designed, and priced to fit the incomes of the people who need them most. By redefining affordability and putting control back in the hands of buyers, we’re ensuring that the homes we build don’t just fit families—they fit their budgets, too.
If you're ready to take on the role of your own Starter Home property developer and build a home that truly meets your needs, HUTS and The Starter Home are here to guide you through every step of the way.
