The continuing rise of homes in the country’s top metropolitan areas are forcing homebuyers to look at cheaper options. Midsize cities in the South and Midwest offer the biggest bang for your buck.
Cities like Chattanooga, Tennessee; Columbia, South Carolina; El Paso, Texas and Louisville, Kentucky could soon be some of the hottest housing markets as home prices there are expected to climb. This according to Realtor.com’s 2023 housing forecast and economic overview.
The real estate listing firm also expects to see prices rise in places like Toledo, Ohio and Buffalo, New York, as buyers continue to be priced out of the larger cities. Those who can work remotely are looking to leave those larger cities for more affordable places to live.
In an interview with CBS’ Money Watch, Realtor.com Chief Economist Danielle Hale said, “If you have a remote work job that you can take with you, then it can make sense to move there because you’re going to see your real estate dollar stretch a lot further.”
According to Realtor.com, Augusta, Georgia is expected to be the hottest housing market in the country. The median home price as of November 2022 is $319,000 and is expected to grow by 5.7% in 2023. Rounding out the top 10 are Buffalo, New York ($240,000, 6%); Chattanooga, Tennessee ($397,000, 8.2%); Columbia, South Carolina ($300,000, 3.6%); El Paso, Texas ($291,000, 5.4%); Grand Rapids, Michigan ($358,000, 10%); Hartford, Connecticut ($372,000, 8.5%); Louisville, Kentucky ($290,000, 8.4%); Toledo, Ohio ($161,000, 6.7%) and Worcester, Massachusetts ($447,000, 10.6%).
According to Zillow, the Midwest in particular is expected to attract more first-time home buyers.
“Having available houses to choose from is another key component of a healthy market, and the Midwest stands out,” Zillow noted in their 2023 predictions released last month. “Inventory isn’t in a massive hole compared to pre-pandemic times and declines in new listings are smaller than the national average– encouraged by the more consistent demand from buyers.”
2022, a year that saw increasing prices in homes and skyrocketing mortgage rates, is over. Cities that were the hottest like Austin, Texas; Boise, Idaho and Phoenix, Arizona have started to cool.
It’s not unusual for home prices to fall near the end of the year, but prices in the top 100 markets will climb again in 2023, according to Hale.
Charlotte metro area ranked 50th in Realtor.com’s 2023 Housing Forecast with a 5.5% year-over-year price change. Homes in the Queen City have a median listing price of $403,852 and spend an average of 55 days on the market, according to Realtor.com.