Exploring Some of America’s More Affordable Cities
The State of Housing
The housing market has been booming for most of the past two years. The number of homes being sold increased and prices went through the roof. More recently things have been cooling. Industry observers attribute this to a combination of inflation and the rising-rate environment that’s led to higher mortgage costs.
Partly as a result of that and other factors, existing-home sales have fallen for five months in a row. Amid economic uncertainty and more would-be buyers being forced to the sideline, sellers have started dropping their prices. Industry observers expect price growth to slow as we head toward fall, especially in certain markets.
Have Internet, Will Travel
It’s no secret that more people are working remote or hybrid schedules — a trend that has left workers less tethered to a specific city or office. Now more people are considering a move in search of better affordability. Real-estate brokerage firm Redfin Corp. (RDFN) says 32.6% of shoppers searched areas outside of their metro area when looking at listings during the second quarter. Prior to the pandemic that number was closer to 26%.
Because workers are able to pick up and leave, it’s possible the next eight months to a year could turn certain areas into buyers’ markets. Analysts say that’s because locations that recorded steep price increases over the past years could actually experience declining prices as the effects of inflation and higher mortgage rates kick in.
Scouting Some Spots
Real estate veterans say the situation is more or less transitioning from one that was a “crazy seller’s market” to a more normal environment. It’s natural for would-be buyers who are considering a move to think about what locations could make the most sense.
According to an emerging housing market index maintained by the Wall Street Journal and Realtor.com, midwestern locations that are both “affordable and outdoorsy” are popular. These include Elkhart, Indiana, Burlington, North Carolina, and Johnson City, Tennessee, which took the top three spots in the second-quarter rankings. Elkhart in particular has a robust job market, posting unemployment over 2% lower than the national average in May. Three of the top 20 markets were in North Carolina. It seems Americans are willing and able to move – if the price is right.
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