Top 5 U.S. Locations Where Home Prices Are Still Rising

Despite what one may hear on- or offline, today’s U.S. real estate market presents a diverse landscape rather than a uniform scene, and can no longer be painted with a broad economic brush. For example, mobility and the prevalence of  remote work  now play more meaninful factors in the buying process, creating a unique market dynamic.

In this blog we will take a look at the top five U.S. locations where home prices are still on the rise . We’ll delve into the factors that could be driving demand and whether people are still buying in these markets.

1. Albany, New York

Albany, New York, demonstrates a vibrant housing market with substantial growth over the past year. In October 2023, median home prices soared by an impressive 8.7% compared to the previous year, marking a median sale price of $250,000. Homes in Albany are selling notably faster, spending an average of only 11 days on the market, significantly reduced from 25 days a year earlier.

Market Dynamics

• Albany’s housing market is highly competitive, with homes selling within 11 days.
• Many homes receive multiple offers, some selling above the list price by about 3% and going pending in 11 days. Exceptional properties can fetch up to 10% above the list price and sell within 6 days.

Migration Trends

• 31% of buyers looked outside Albany, while 69% preferred staying within the area.
• A small percentage (0.38%) from outside metros considered moving into Albany.
• New York, Syracuse, and Boston show the most interest in relocating to Albany.
• 69% of movers within Albany prefer to stay local. Miami, Portland, and Sarasota are popular destinations for those leaving Albany.

Insights

• Albany’s market remains robust due to a competitive environment, a strong local economy, and limited housing supply.
• The city attracts both local residents and newcomers, evidenced by quick sales and increased prices.

2. Rochester, New York

Rochester, New York’s housing market is bustling with activity and high competition, making it a noteworthy landscape for buyers and sellers alike:

Market Trends:

• Median home prices surged by 11.9% in September 2023, reaching $160,000, with a $112 median sale price per square foot.
• The market is incredibly competitive, with homes receiving an average of 9 offers and selling within a mere 9 days.

Buyer-Seller Dynamics:

• Buyers face a fast-paced environment and need to act quickly, make competitive offers, and remain flexible with their criteria.
• Sellers can anticipate quick sales at favorable prices but should expect stiff competition and ensure their homes are appealing to buyers.

Forecast and Market Momentum:

• Zillow notes a typical home value of $205,373 in Rochester.
• Key metrics depict a market favoring sellers, with homes often selling above list prices (88.4% over list) and a median days-to-pending of 8 days, indicating swift transactions.

3. Grand Rapids, Michigan

Grand Rapids, Michigan’s housing market presents a competitive yet vibrant landscape for buyers and sellers:

Market Trends:

• Median home prices surged by 5.8% in October 2023, hitting $267,000, with a $194 median sale price per square foot, up by 11.5% since the previous year.
• Homes in Grand Rapids typically receive 5 offers and sell within a brisk 8 days on average.

Market Dynamics:

• The housing market in Grand Rapids maintains a moderate level of competitiveness, with homes selling in about 7 days and some receiving multiple offers.
• On average, homes sell around 3% above the listed price and achieve pending status within approximately 7 days. Exceptional properties can fetch up to 8% above the list price and sell within 5 days.

Migration and Relocation Trends:

• Around 32% of buyers in Grand Rapids considered moving outside the city, while 68% preferred staying within the metropolitan area.
• A minor fraction (0.47%) of homebuyers from across the nation searched to relocate into Grand Rapids, with interest primarily coming from Chicago, Detroit, and Lansing.
• 68% of Grand Rapids residents exploring moves preferred staying within the metropolitan area. Sarasota, Cape Coral, and Miami emerged as popular destinations for those venturing out.

4. Buffalo, New York

Buffalo, New York’s housing market is a magnet for homebuyers and real estate enthusiasts alike. Here’s a concise snapshot of the market’s dynamics:

Market Trends:

• In September 2023, Buffalo’s median home price increased by 1.0% to $202,000 compared to the previous year.
• Properties in Buffalo were selling in 13 days on average, indicating high demand and a quick turnover, albeit slightly longer than the previous year’s 11 days.
• 229 homes were sold in September, a decrease from 255 homes sold during the same period the previous year, suggesting a slightly slower pace.

Market Competitiveness:

• Buffalo’s housing market is described as very competitive, with a Redfin Compete Score™ of 100. Multiple offers are common, with some homes selling approximately 5% above list price and going pending in about 13 days.
• Hot properties command premiums of up to 15% above list price and sell within just 8 days, showcasing intense competition for specific homes.

Forecast:

• The Buffalo housing market demonstrates steady growth, with the average home value at $215,219, marking a 4.0% increase over the past year.
• Properties are pending in around 10 days, reflecting high demand and a positive trend for homeowners.

5. Seattle, Washington

Seattle, Washington’s housing market remains fiercely competitive, attracting both local and external attention:

Market Trends:

• In October 2023, Seattle’s median home price decreased by 4.1% to $815,000 compared to the previous year. However, the median sale price per square foot increased by 1.1% to $562.
• Homes in Seattle were selling in 12 days on average, down from 13 days the previous year, indicating continued demand but a slight slowdown.
• 629 homes were sold in October, a decrease from 683 homes sold during the same period last year, suggesting a moderated pace.

Market Competitiveness:

• Seattle’s housing market retains its intensity, with a Redfin Compete Score™ of 80, indicating high competitiveness. Multiple offers are commonplace, with some homes selling around the list price and going pending within approximately 11 days.
• Exceptional properties can sell for about 2% above the list price and go pending in a swift 5 days, demonstrating heightened competition for select homes.

Migration Trends:

• 18% of Seattle homebuyers considered moving out of the city, while 82% preferred staying within the metropolitan area.
• About 4% of homebuyers from outside metros searched to relocate into Seattle, with top origins being Louisville, San Francisco, and Los Angeles.
• Among Seattle residents exploring moves, 82% aimed to stay within the metropolitan area. Spokane, Phoenix, and Wenatchee were popular destinations for those considering relocation.

Are People Still Buying There?

Despite rising home prices, as seen by the numbers, the demand for housing remains strong in these five locations. Buyers are active for a variety of resons. While rising interest rates may impact affordability, the overall demand for housing is expected to continue in these markets.

Embrace the Dream of Homeownership

The U.S. real estate market continues to offer promising opportunities for homeownership, particularly in the five cities highlighted above, where home prices are still on the rise. While market fluctuations are inevitable, the long-term benefits of homeownership remain compelling, providing stability, financial security, and a sense of belonging.

Owning a home offers a hedge against inflation, as the value of your property tends to appreciate over time. Additionally, homeownership provides tax benefits and the potential to build equity, which can serve as a valuable financial asset. Beyond the financial advantages, owning a home fosters a sense of community and belonging, creating roots and lasting memories.

Unlock Affordability with Rate Buydown Solutions

While rising interest rates may impact affordability, there are strategies available to mitigate this impact. Embrace Home Loans^® offers a variety of rate buydown products, such as lender-paid buydowns and temporary buydowns, which can help lower your effective mortgage rate and reduce your monthly payments. By working with a knowledgeable mortgage lender like Embrace Home Loans, you can explore these options and find the best solution for your financial situation.

Whether you are a first-time homebuyer or an experienced homeowner, the path to homeownership is filled with exciting possibilities. By understanding the market trends, exploring financing options, and seeking expert guidance, you can make informed decisions and realize your dream of owning a home.