By The housing market’s stagnation in 2023 is expected to continue into 2024, according to a forecast published by Realtor.com. However, there are certain metro areas that are projected to experience both rising prices and sales next year, with Toledo, Ohio leading the pack.
Top Housing Markets in 2024
Realtor.com’s analysis reveals that the top housing markets in 2024 are predominantly located in the Northeast, Midwest, and California. By estimating changes in home prices and sales volume across various locales in the U.S., Realtor.com has identified the places where these metrics are expected to increase the most among the 100 largest metros.
These are the top five housing markets for 2024:
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Toledo, Ohio: Existing-home prices in Toledo are forecasted to rise by 8.3% compared to the previous year, while sales will see a 14% increase. This combines to a significant growth rate of 22.3%.
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Oxnard, California: Home prices and sales volume in Oxnard are set to increase by 3.3% and 18%, respectively.
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Rochester, New York: Rochester is anticipated to experience a price increase of 10.4% and a sales growth of 6.2%.
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San Diego, California: San Diego will see a rise in home prices and sales volume, although the specific percentage figures were not provided.
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Riverside, California: Similar to San Diego, Riverside is expected to experience an upturn in both prices and sales.
Additional cities that made the list include Bakersfield and Los Angeles in California, as well as Springfield and Worcester in Massachusetts.
Unique Findings
The standout cities listed above can be considered anomalies in comparison to Realtor.com’s previous announcement that U.S. existing-home sales volume is expected to remain relatively stable in the coming year, while prices are predicted to decrease by 1.7%. This overall trend is due to limited inventory, resulting in higher price growth but fewer sales in larger metropolitan areas.
Affordability and Economic Anchors
The top housing markets in the Midwest and Northeast are characterized by more affordable housing options and economies that are anchored around sectors expected to experience growth in 2024, such as education, healthcare, and manufacturing. The report highlights the correlation between strong employment rates and increased home sales.
The Top Housing Markets to Watch in 2023
According to Realtor.com, five of the top 10 metro areas to watch in 2023 are located in southern California. These markets are expected to outperform the rest of the state, with a projected average sales growth of 13.1%. In contrast, other California areas in the report’s top 100 are anticipated to experience a decline of 4.1%.
The report highlights two key trends that will drive the remarkable sales growth and price gains in these top housing markets. First, in relatively affordable markets, buyers are actively searching for lower housing costs, which will boost sales. Second, in expensive markets that were impacted by rising mortgage rates in 2022 and 2023, lower rates in the coming year are expected to ignite a rebound in sales.
Danielle Hale, Realtor.com’s chief economist, states, “Home buyers are still looking for markets where they can capitalize on lower prices. Even in some of the more expensive markets, we’ll see double-digit sales growth as sales start to rebound from their historic lows, helped by mortgage rates which are expected to finally relent.”
However, not all areas will experience a rebound in 2023. The report predicts that prices and sales will witness the most significant decline in Austin, Baton Rouge, L.A., and Portland, Ore.
These projections align with the shifting price trends observed this year. As per the Federal Housing Finance Agency’s measurements, prices in the first three quarters of this year have increased the most in New England and the East North Central census division, which includes Wisconsin, Illinois, Indiana, Ohio, and Michigan. In contrast, during the same period in 2022, prices had seen the highest gains in the South Atlantic and Mountain regions.
So, if you want to stay informed about the top housing markets to watch in 2023, keep an eye on these metro areas in southern California and monitor how these trends unfold.
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