The Nation’s 20 Hottest Real Estate Markets
I bought my first home in Salt Lake City last year. When I’d first decided to buy, I looked at the house hunting process through a pair of rose-and-HGTV-colored glasses. I thought I’d spend a few weeks browsing beautiful fixer-uppers in the city’s most established and up-and-coming neighborhoods, put in an offer on the home of my dreams, and then, presto, homeownership.
Here’s what I didn’t realize: Utah is the fastest-growing state in the nation, earning Salt Lake City a comfortable spot on the list of hottest U.S. real estate markets.
Naïve or not, I learned quickly if I liked a house, I had to act immediately. I put in same-day offers above asking price, offered to pay closing costs and added escalation clauses in case anyone came in with higher bids. Even with all of that, a cash buyer beat out my first offer. And my second. And my third.
My story isn’t unique. In fact, in today’s real-estate market, it’s the norm.
"You go to look at houses on Saturday, and on Sunday you get an email from the realtor that they have 10 offers lined up so get your best offer in on Monday at 9 a.m.," Jill Freshwater, 34, told NBC News of her home-buying experience in Dallas, Texas.
Inventory is low: The number of homes selling for less than $500,000 (the price point most first-time and millennial buyers are working with) is down 26 percent from last year. That means people aren’t hesitating to snap up a house when they find one. Homes are selling faster than they have in a decade, according to the National Association of Realtors.
For those of us who took high school economics, it’s no surprise that low supply and high demand are sending home prices soaring. Analysts from realtor.com determined the average home list price reached $260,000 in 2017, up 8 percent from last year.
If you think housing competition is fiercest in major cities, think again: The mini-metropolis is having a moment. Well-qualified buyers are flocking to mid-sized and smaller cities in pursuit of a slower pace and higher quality of life.
“Jobs and opportunities are increasingly growing in smaller markets away from the coasts. Mid-size cities like Salt Lake City, Portland, and Nashville are desirable places to live, with good employment opportunities and steady economic growth," said Zillow Chief Economist Dr. Svenja Gudell. “The growth and demand for housing will drive up home prices in 2017, and these hot markets are experiencing change as more people discover them."
In other words: If you’re gearing up to buy a home in a hot market, best bring your A-game.
Las Vegas, Nevada
Las Vegas’ once-dismal housing market is on the rise again. The recession hit Sin City especially hard, with home prices depreciating by as much as 40 percent after the crash.
Steady population increase and job growth has led to slowly-but-surely increasing prices, though home values still remain 14 percent under pre-recession numbers. Forbes analysts cite Vegas as an ideal market for investment buyers in 2017.
California’s capital city, with its population of roughly 500,000, is the only city in the Golden State to make the cut. While still not back to pre-recession heights, Sacramento’s median home price reached 285,000 in April 2017, up 11.3 percent in 12 months.
Sacramento is just far away enough from the notoriously-expensive Bay Area, and Redfin’s migration report anticipates a wave of buyers looking to escape San Francisco.
“Sacramento home prices are rising quickly, but are still 58 percent less expensive than the median Bay Area home,” a Zillow representative wrote in a statement.
Trulia cites the Tampa area as a market to watch this year, courtesy of high employment and major development in the downtown area.
“The market has been good all over. Things are back to where they were during the boom in some areas and if you're not completely back, you're close,” Ron Balseiro, who has worked as a home appraiser in Tampa for more than 44 years, told the Tampa Bay Times.
Buyers are taking advantage of Tampa’s steadily climbing home values to flip homes, according to the Tampa Bay Times. “Among the 117 major metro areas with at least 250 flips, Tampa Bay had the fourth-highest flipping rate. Nearly 10 percent of all bay area homes sold last year were flips,” they reported.
A new rush of millennial buyers, job growth, and low-inventory make Boston the singular northeastern city on this list.
The Bay State’s median home price hit $342,500 in January, a 7 percent climb from January 2016, reports Boston-based real estate tracking firm Warren Group.
“Remaining inventory is flying off the shelves,” Paul Yorkis, president of the Massachusetts Association of Realtors, told the Boston Globe. “[January] was the lowest month’s supply of home listings that we have seen since MAR began recording the data in 2004.”
San Antonio, Texas
Record home sales in 2016 and a 6 percent increase in home prices paint a strong picture for this Texas market. Low cost of living and steady job opportunities from companies like Toyota and USAA make San Antonio an attractive place to live.
“There’s a steady supply and demand for homes,” San Antonio Real Estate Agent Lisa Sinn told Forbes. “That means home prices are more affordable.”
Dallas-Fort Worth, Texas
Another win for the Lone Star state. Home values in the Dallas-Fort Worth Area are higher than they’ve been in a decade, according to the CoreLogic Case-Schiller Home Price Index.
"We are seeing nothing that would indicate any change in that trend — we expect you to keep this up,” Realtor.com Chief Economist Jonathan Smoke told Dallas News. Smoke credits the city’s booming economy as the main engine for market growth.
"Could you ask for a better job market than the Metroplex?" he said. "There is no metropolitan area in the country producing more jobs this year.
"You continue to have that economic mojo."
Zillow forecasts homes will appreciate 4.4 percent in value this year, putting Knoxville on the map as a market to watch.
““If you’re somebody out there thinking about selling, now is the time,” said Jeff Grebe, a real-estate broker in Tennessee. Grebe told local media outlet WATE the strong seller’s market is making homebuying tough, especially for first-time buyers.
“Now it’s not really about how much you can save on the home, it’s about getting the home,” he added.
Ready for mile-high life? While Denver’s median home price is rising at a sluggish pace compared to most on this list – 3.6 percent – the city’s affordability, appeal to outdoor lovers, and impressively-low 2.9 percent unemployment rate keep this market white hot.
Like Denver, unemployment in Ogden is low at 2.9 percent, but the northern Utah city of less than 90,000 people is also seeing a healthy rise in home price, with Zillow predicting 4.7 percent appreciation in 2017.
Low home inventory in Portland is making the Pacific Northwest city a tough market to break into.
Portland’s Multiple Listing Service displayed only 3,300 homes at the end of February. For context, that’s about a six-week supply of homes, compared to a normal six-month supply, reported Oregon Live.
High demand led Zillow forecasters to predict a 5.2 percent rise in home prices this year.
A once-overlooked city about 30 miles from San Francisco, affordable Vallejo’s housing market is skyrocketing toward the top of the list.
“As more and more buyers and renters are priced out of San Francisco and surrounding towns, they’ve become increasingly open to new frontiers,” realtor.com reports. “Now it’s hitting Vallejo big-time.”
Javier Vivas, realtor.com’s manager of economic research, says buyers are overlooking poor public schools and higher crime rates to be able to own property at their price point.
"It still remains one of the few arguably affordable places in Northern California," Vivas said. "That makes owning a viable option in Vallejo, driving up demand."
Cape Coral-Fort Meyers, Florida
The future looks bright in Florida. The cities of Cape Coral and Fort Meyers topped Forbes’ 2017 list of fastest-growing cities. Explosive population growth (3.39 percent) and impressive job growth (3.93 percent) have transformed a burgeoning real estate market into a superstar.
Raleigh, North Carolina
Fewer than 3,000 homes were listed for sale in Raleigh in late April 2017 – a 16 percent drop in inventory from last year, WUNC reports.
In another classic case of low-supply, high-demand, prices for Raleigh homes are on the rise: The median home price sits at $221,800, up 8.2 percent in a year. Zillow anticipates prices will rise another 3.7 percent in 2017.
According to 2016 data from Orlando Regional Realtor Association, the Orlando Market is seeing a sharp rise in demand and home value, with much of the area back at pre-recession prices.
Homes are due to get 5.7 percent more expensive in 2017, Zillow forecasts.
Salt Lake City, Utah
Salt Lake City is growing quickly, and it’s that population growth that makes it a market to watch. Jim Wood, economist at the University of Utah’s Kem C. Garner Policy Institute, told the Deseret News that builders are struggling to keep up with the new demand. For the first time in 40 years, the increase in Utah households surpassed the number available housing units.
“That’s where we are in all three markets — apartments, existing homes and new [construction],” Wood said. “Builders sell everything they’ve got.”
With that in mind, it’s no surprise Zillow predicts a 4.3 percent rise in median home value in the Beehive State’s capital city.
Home values in this midwestern city reached record highs in April 2017, according to data compiled by Columbus Realtors, with buyers snatching up inventory as soon as they find it.
“Increased buyer presence is fueling home price escalation,” the firm’s 2017 president Mic Gordon said in a statement. “The average time a home is on the market is 43 days. The average used to be 105 days.”
Jacksonville’s population is growing at twice the average national rate. What’s more, the number of jobs grew 3.8 percent in 2016, making Jacksonville “one of the healthiest markets for employment opportunities in the state,” Trulia reports. “There are so many people moving here and very little leaving,” local real estate agent Michael Paull told the site. “There’s long-term economic stability here plus great schools, fantastic weather, and proximity to the ocean.”
Another tech mecca is blossoming in the Rocky Mountains. Cheekily called ‘Silicon Slopes,’ the conglomerate of technology companies moving into Utah County are attracting new employees by the thousands. Provo City’s low cost of living and short commute to Utah’s largest tech employers appeal to buyers moving in from out of state.
Zillow predicts home values will rise 4.3 percent in 2017, which means Provo, home to Brigham Young University, is shaping up to become more than just a college town.
Home to tech giants like Amazon and Microsoft, Seattle boasts a strong economy and a wealth of well-paid residents in need of somewhere to live.
Frenzied competition is creating double-digit growth in home value for more than a year, according to data from the S&P CoreLogic Case-Shiller Home Price Index.
"We are falling behind tens of thousands of units a year and have been for several years," Sam DeBord, managing broker for Seattle Homes Group, told CNN Money. "The basic law of supply and demand can't be ignored. That is what is at the heart of this housing crisis."
The hottest real-estate market in the United States? Nashville, according to Zillow Analysts.
“Music City has moved beyond its country roots to become a fast-growing economy with employment by the healthcare industry and big corporate names including Nissan, Randstad and Kroger,” Zillow said in a release.
Zillow anticipates home appreciation to rise by 4.3 percent this year, along with a 1.1 percent increase in average income. That’s certainly something to sing about.