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North Carolina Housing Market Trends and Forecast for 2024

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The North Carolina Housing Market is rich with opportunities, standing out not just among Southern states but across the entire U.S. One unique fact is that North Carolina has seen steady growth in home values, primarily driven by increasing demand due to its desirable climate and growing job market.

Did you know that the average home value in North Carolina is approximately $335,760, showcasing a 3.8% increase over the last year? What’s more intriguing is that as of July 2024, a whopping 21.8% rise in inventory has been noted when comparing the number of homes for sale year-over-year, indicating a shift in the market dynamics. The Raleigh-Durham area remains especially attractive, recognized for its thriving tech scene.

North Carolina Housing Market

Key Takeaways:

  • Average Home Value: $335,760 (up 3.8% YoY)
  • Median Home Price: $390,100 – anticipated to drop slightly as inventory rises
  • Inventory Increase: 21.8% year-over-year homes for sale
  • Market Shift: With inventory on the rise, more homes are becoming available, encouraging potential buyers

Current Trends in the North Carolina Housing Market

Amid sustained interest from home buyers, the North Carolina Housing Market is currently experiencing intriguing changes. As more buyers congregate in this attractive state, it's essential to explore how recent trends are reshaping the landscape. In 2024, the housing market is seeing substantial fluctuations. One interesting observation is that while home sales have begun to decline, housing prices continue to climb. The consistent interest in North Carolina's scenic beauty and robust job market drives this price resilience.

The median sales price across the state has reached about $390,100, reflecting increases attributed largely to areas with rapid growth, such as Charlotte and the Triangle region, where tech jobs are flourishing. Notably, the profits from sales in these sectors are buoying the home prices, leading to a competitive seller's market despite an uptick in available inventory.

Moreover, listings show a slight yet significant uptick by approximately 12% year-over-year, which indicates that sellers are becoming more confident in presenting their homes on the market. According to the North Carolina REALTORS®, the total number of home sales has experienced variances with 52,188 new listings in June 2024 alone, indicating a market that is beginning to stabilize as we move deeper into the year. NC REALTORS®

Diving Deeper into Market Dynamics

One important factor influencing the North Carolina Housing Market is the ongoing housing shortage. The demand for homes continues to outpace supply in many areas, leading to competitive bidding situations. This is particularly true in urban centers where economic opportunities are on the rise.

According to Redfin, the median price for homes in North Carolina as of July 2024 reflects a 2.3% increase compared to last year, with homes averaging around $394,800. Buyers are finding themselves competing fiercely for desirable properties, particularly in regions close to Raleigh and Charlotte, which have reported notable population influxes. This activity signifies a robust and competitive housing market where inventory levels will play a crucial role in future price stabilization. Redfin

Forecasting the Future of the North Carolina Housing Market

Looking ahead, the North Carolina Housing Market is expected to undergo several transformations. Experts predict that the growth trajectory for home prices will continue, albeit at a more moderated pace as we progress through 2024. Increased inventory is anticipated to balance the market dynamics, which may lead to easing price pressures. Some sources even suggest that the median home price could show slight declines in specific areas due to rising inventory levels.

According to Zillow, the average home appreciation is projected to be around 2.8% into 2025, suggesting that we will not see a dramatic downturn, though quantity will play a fundamental role in shaping pricing norms. The increased supply could prevent home prices from escalating as caregivers and first-time buyers find their footing in a still-competitive setting. Zillow

Furthermore, as interest rates have fluctuated, creating a more favorable environment for financing, many prospective home buyers are returning to the market. The NC Housing Report notes that the re-emerging buyer interest could sustain a healthy pace of sales, albeit tempered with the reality of burgeoning inventory.

Demographic Influences on Market Trends

Understanding who is driving demand is crucial in the North Carolina Housing Market. The state is increasingly attracting millennials seeking a better quality of life, which contributes significantly to ongoing residential demand. With cities such as Charlotte and Raleigh being top contenders for relocation, bolstered by economic opportunities in fintech, biotech, and healthcare, North Carolina is well-poised for continued development.

In summary, key data points suggest the state commands a competitive stance in the housing market with favorable forecasts looking forward. The infusion of more homes will create avenues for potential buyers

Will the North Carolina Housing Market Crash?

The question of whether the North Carolina housing market will crash in 2024 remains a hot topic among buyers, sellers, and investors alike. Predictions about market stability consider various factors, including economic indicators, demographic trends, and housing inventory levels. As of now, most experts agree that a crash is unlikely.

Current Stability in the Market

Despite some fluctuations in home prices and demand, the North Carolina housing market shows considerable resilience. The market is expected to remain steady in 2024 and 2025. Experts emphasize that while there may be low housing demand and modest home price fluctuations, overall market conditions do not present indicators of an imminent crash. This stable environment is bolstered by ongoing demand for housing, driven largely by an influx of new residents and strong job growth in the state.

Moreover, the North Carolina housing market is experiencing significant growth in inventory, which has risen by 21.8% year-over-year as of mid-2024. This increased supply is expected to provide more options for potential buyers, which in turn may lead to a more balanced market. Although higher inventory levels can sometimes lead to price drops, the current economic fundamentals—like a robust job market and population growth—help maintain price stability.

Economic Factors Supporting Market Confidence

The North Carolina housing market benefits from a strong economic backdrop. Major urban areas like Charlotte, Raleigh, and Durham are experiencing excellent job creation rates, particularly in sectors like technology and healthcare. Local economies remain favorable, keeping demand for housing high. For instance, Charlotte continues to grow as a financial hub, attracting new residents.

The median home price in North Carolina is hovering around $390,100, with an appreciation of 4.4% year-over-year. It signals moderate, sustainable growth rather than explosive pricing typical of a speculative bubble. This growth reflects a healthy market rather than the signs usually associated with a potential crash, such as rampant speculation or unsustainable price increases.

Potential Risks and Market Watch

While the outlook remains positive, several factors could create headwinds for the North Carolina housing market. For example, interest rates have fluctuated, and if they rise significantly, it could dampen buyer enthusiasm. However, analysts predict that any future interest rate hikes will be incremental and manageable, sparing the market from sharp shocks.

Additionally, while the current housing shortage continues, major initiatives to increase housing supply are underway. These developments will likely stabilize prices by meeting demand. Local governments and developers are responding to the urgent need for affordable housing, further reducing the risk of a market downturn.

Looking Ahead to 2024 and Beyond

Future predictions regarding the North Carolina housing market remain optimistic. Most forecasts suggest that prices will remain stable or see modest increases over the next couple of years. The expectation of increased inventory and a recovery in buyer sentiment will likely lead to a balanced market—even as demographic trends continue to favor growth in major urban areas.

In conclusion, while the North Carolina housing market does face challenges, the consensus among experts suggests a low probability of a crash in the immediate future. Instead, potential fluctuations in home pricing or demand should be monitored closely, allowing for informed decision-making by buyers, sellers, and investors.

South Carolina Housing Market Trends & Forecast for 2024

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The South Carolina housing market has become a focal point for many buyers, sellers, and investors alike, as trends show an upward trajectory in property values and sales activity. With its picturesque landscapes, vibrant culture, and hospitable climate, South Carolina is not just a desirable place to live; it’s also an attractive option for real estate investment. Let’s delve deeper into the specifics of this market, highlighting key statistics and trends.

The South Carolina Housing Market: Trends and Insights

Key Takeaways

  • Median Home Price: The current median home price in South Carolina stands at $383,200 as of July 2024, reflecting a 3.4% increase from the previous year (Redfin).
  • Average Home Value: As per Zillow, the average home value in the state is about $300,746, marking a similar increase of 3.4% over the past year (Zillow).
  • Performance Variances: Individual cities, such as Charleston and Columbia, exhibit differing trends, with Charleston seeing average prices around $650,000, an increase of 23.2%, while Columbia's average is around $255,000, up 2.2%.
  • Market Competitiveness: Many areas in South Carolina remain competitive, with average scores generally ranging from 46 to 66 out of 100 on the competitiveness scale.

Current State of the South Carolina Housing Market

This year, the South Carolina housing market has exhibited some interesting dynamics. A key point to note is that the increase in home prices comes at a time when housing inventory is tightening. Homes are selling at a rapid pace, often within weeks of being listed, owing to increased buyer demand fueled by low mortgage rates and a desire for more spacious living arrangements, especially in the wake of the pandemic.

Inventory concerns are clear, with data indicating that the number of homes for sale in some markets has decreased significantly. As a result, sellers are enjoying favorable conditions, often receiving multiple offers on well-priced properties. For instance, homes in metropolitan areas like Charleston are experiencing fierce competition, with average list-to-sale ratios reflecting premium selling prices.

Additionally, many potential buyers have been drawn to the state's appealing lifestyle offerings, combined with more affordable pricing compared to neighboring states such as Georgia and North Carolina. This trend is especially notable in tourist favorite spots like Myrtle Beach, where the average home price has recently peaked at $320,000. However, this area has a unique dynamic; it is not as competitive compared to other parts of the state, scoring only 14 out of 100 on the competitiveness scale (Redfin).

City-Specific Insights

Charleston, SC

The Charleston housing market stands out due to its historical charm and coastal appeal. As of the latest data, the city has an average home price of $650,000, showcasing a remarkable increase of 23.2% year-over-year. This growth can be attributed to demand from affluent buyers and a constant influx of new residents attracted to the city’s vibrant culture and job opportunities (Redfin).

Columbia, SC

In contrast, the capital city of Columbia presents a different narrative. Here, average home prices hover around $255,000, reflecting a modest increase of 2.2%. Columbia appeals to a mixed demographic, including students, families, and professionals working in government and education sectors (Redfin). The market competitiveness rating of 66 indicates a healthy demand, but at a different scale compared to Charleston.

Myrtle Beach and Coastal Regions

Moving to Myrtle Beach, the surroundings reflect a blend of vacation homes and permanent residences. With an average price of $320,000, this market has become a focus for both retirees and those seeking a second home. Interestingly, despite its tourist appeal, its lower competitiveness score suggests there might be opportunities for buyers. The luxury sector, however, has seen price surges, enhancing the overall market dynamics (Redfin).

Market Trends and Future Outlook

Observing broader trends in the South Carolina housing market, certain factors indicate that we should expect continued growth in property values. The low-interest-rate environment has motivated buyers to enter the market, and the comfort of suburban living remains a prominent theme among the younger demographic and families.

As we transition further into late 2024, real estate experts anticipate that while prices may stabilize somewhat, the overall demand will continue to support gradual increases. However, economic factors such as rising inflation rates, changes in lending criteria, and potential shifts in employment patterns across the state will undoubtedly influence these trends.

Challenges may arise from rising mortgage rates, which could dampen demand somewhat, but the underlying factors of population growth and attracting new residents will likely maintain a robust market. Cities like Greer and Summerville, with average home prices of $337,000 and $381,000 respectively, will play pivotal roles in shaping this growth as they become increasingly desirable for families looking for more affordable housing options (Redfin).

Conclusion

The South Carolina housing market benefits from a combination of factors that enhance its attractiveness, including affordability, climate, and lifestyle. The data reflects a market in motion, with rising prices and competitive conditions highlighting the desirability of various locales throughout the state.

Moving forward, the South Carolina housing market appears poised for sustained interest, making it a noteworthy area for both potential homeowners and real estate investors alike.

Regional Housing Market Forecast in South Carolina

The Regional Housing Market Forecast in South Carolina reflects diverse trends across various metropolitan areas, highlighting both challenges and opportunities for homeowners and investors alike. As of August 31, 2024, several regions exhibit fluctuations in growth rates, with areas like Seneca experiencing a positive outlook with a forecasted increase of 0.5%, while Myrtle Beach faces potential declines, reflecting a -0.3% change (Zillow).

Similarly, cities such as Charleston and Columbia are expected to show moderate growth, with anticipated increases of 1.4% and 1.3% by July 2025. Conversely, markets like Newberry and Bennettsville may experience declines, indicative of the varying dynamics present within the state. Overall, the South Carolina housing market presents a complex picture, where localized factors play crucial roles in shaping property values and market competitiveness.

Region Name State Name Base Date 31-08-2024 31-10-2024 31-07-2025
Greenville, SC SC 31-07-2024 0 -0.4 1.1
Columbia, SC SC 31-07-2024 0.1 -0.1 1.3
Charleston, SC SC 31-07-2024 0 -0.4 1.4
Myrtle Beach, SC SC 31-07-2024 -0.3 -0.8 1.2
Spartanburg, SC SC 31-07-2024 0 -0.3 1.6
Hilton Head Island, SC SC 31-07-2024 0 -0.2 2.6
Florence, SC SC 31-07-2024 0 -0.6 -0.3
Sumter, SC SC 31-07-2024 -0.1 -0.7 -1.5
Orangeburg, SC SC 31-07-2024 0.1 -0.5 -0.6
Seneca, SC SC 31-07-2024 0.5 0.7 3.1
Greenwood, SC SC 31-07-2024 -0.1 -0.6 0.7
Georgetown, SC SC 31-07-2024 0 -0.2 1.9
Gaffney, SC SC 31-07-2024 0.4 -0.4 -2.1
Newberry, SC SC 31-07-2024 -0.3 -1.3 -0.8
Bennettsville, SC SC 31-07-2024 0.6 -0.2 -4.1

Read About: Charleston SC Housing Market Trends

Will The South Carolina Housing Market Crash?

We continue to hear rumors of a market crash, but local data does not corroborate this at this time.  Forecasting a housing market crash requires careful consideration of numerous economic indicators, market fundamentals, and external factors. While no market is immune to fluctuations, South Carolina's housing market currently does not show indications of an imminent crash. However, it's essential to monitor key metrics closely, such as inventory levels, mortgage rates, and economic trends, to anticipate any potential shifts and mitigate risks.

According to recent reports, the South Carolina housing market has been experiencing a surge in demand and rising prices. This is partly due to an influx of people moving to the state from other parts of the country, attracted by the state's relatively low cost of living, pleasant climate, and the growing job market.

South Carolina is a fantastic place to live or retire due to its pleasant temperature and low total cost of living. According to a Retirement Living poll, South Carolina is the fourth best state in which to retire. South Carolina boasts a reduced cost of living and several lovely beaches that are warm almost all year.

However, some experts have expressed concern that this rapid growth in demand and prices could eventually lead to a housing bubble and subsequent crashes. If interest rates were to rise significantly, for example, it could make it more difficult for buyers to afford homes, which could lead to a decline in demand and a subsequent drop in prices.

That being said, it's important to note that the South Carolina housing market has weathered economic downturns in the past and has generally shown resilience. Additionally, there are many factors that could impact the housing market in the future, including changes in government policies, demographic shifts, and natural disasters.

Ultimately, it's difficult to say with certainty whether the South Carolina housing market will crash. However, it's always a good idea to do your own research and consult with experts in the field before making any significant financial decisions.

Montana Housing Market: Prices, Trends, Forecast 2024

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Nestled amidst breathtaking mountains and sprawling plains, Montana's housing market offers a unique perspective. Prices have risen steadily, outpacing the national average. While the market leans towards sellers due to limited inventory, recent trends show a potential shift. This article explores the Montana housing market, exploring current trends, affordability considerations, and valuable insights for potential buyers and sellers.

Trends in the Montana Housing Market

Price on the Rise: A Seller's Market (for Now)

The most prominent trend is the 5.8% year-over-year increase in Montana's median home sale price. This signifies a consistent rise in home values across the state, potentially making it an attractive time for sellers to capitalize on this momentum. However, a closer look reveals some intriguing nuances.

Fewer Homes Sold: A Cooling Market or Shifting Dynamics?

While prices climb, the number of homes sold presents a contrasting picture. Redfin reports a 4.9% decrease in homes sold compared to the previous year. This could be attributed to several factors. A tightening market with fewer available properties might limit transactions. Alternatively, it could indicate a shift towards a more balanced seller-buyer dynamic, where buyers have more options and potentially take longer to make decisions.

Faster Sales: A Hint of Changing Tides?

The median days on the market offer another interesting perspective. Data suggests a slight decrease in this metric. This could imply that homes are selling a bit faster compared to the previous year. This might be due to the lower number of available properties, creating a sense of urgency among buyers in a competitive market.

While data provides a valuable starting point, it's crucial to consider other factors influencing Montana's real estate scene:

  • Inventory Levels: A Potential Shift: May's data shows a 20.2% rise in homes for sale. This increase could signal a potential move away from a seller's market towards a more balanced market, where buyers have more options and potentially greater negotiating power.
  • Regional Variations: Location Matters: Price trends and inventory levels can vary significantly across Montana's diverse regions. Mountain resort towns might see a different market dynamic compared to rural areas. Researching specific locations is essential for a more precise understanding of the market conditions.
  • Economic Factors: Montana's job market and overall economic health can significantly impact buyer demand. Staying informed about these factors can help predict future market trends.

Predictions for the Montana Real Estate Market

The average Montana home value is $466,311, up 5.1% over the past year and going to pending in around 34 days (Zillow). Median sale price refers to the middle value of all the sale prices in a given time frame, with half of the properties selling for more and half selling for less. As of April 2024, the median sale price was $461,250.

Median list price, on the other hand, represents the middle value of all the listed prices for properties during a specified period. It indicates the price at which half of the properties listed were priced higher and half were priced lower. The median list price stood at $531,333.

Percent of sales over list price is the percentage of properties that sold for more than their listed price during a particular period. 12.7% of sales were above the list price.

Percent of sales under list price, conversely, represents the percentage of properties that sold for less than their listed price within a specified timeframe. 70.8% of sales were under the list price in April.

This graph by Zillow illustrates the growth of home values in the region over the past year, along with a forecast suggesting this trend will likely continue for the next year.

Predictions for the Montana Real Estate Market

Montana's real estate market predictions for 2024 paint a picture of a dynamic landscape with some key trends to consider:

Potential Shift from Seller's Market: While Montana has seen a seller's advantage due to low inventory, there are hints of a change. The decrease in homes sold and a potential rise in available properties could signal a move towards a more balanced market, giving buyers more options.

Price Stabilization or Slight Decrease: Rising mortgage rates nationwide might dampen buyer enthusiasm. This, coupled with potentially more inventory, could lead to price stabilization or even a slight decrease in some areas. However, some analysts still predict modest price increases, particularly in desirable locations.

Return of Sellers: With historically high interest rates in 2023 deterring some sellers, predictions suggest they might return to the market in 2024, potentially increasing inventory. This could further impact the seller-buyer dynamic.

Regional Variations Remain: Experts emphasize that Montana's market is far from uniform. Resort towns and areas with strong job growth are likely to see continued seller advantages and potentially higher prices. Rural areas might experience a slower pace or even a shift towards a buyer's market.

Will The Montana Housing Market Crash?

We continue to hear rumors of a market crash, but local data does not corroborate this at this time. The increase in Montana house listing prices is causing homes to be on the market for a long. If the pattern continues, the inventory may continue to increase and dampen market activity. There aren't enough homes for sale to meet buyer demand.

While it's impossible to predict the future with certainty, there are currently no significant indicators suggesting an imminent housing market crash in Montana. The state's housing market has remained relatively stable, with consistent demand and modest appreciation in home prices.

Economic factors, such as job growth and population trends, also contribute to the market's overall health and resilience. However, it's essential to monitor market conditions regularly and be aware of any potential risks or shifts in the broader economy that could impact the housing market in the future.

Bottom line: We're not seeing any major home price decline or crash in the Montana housing market just yet. The present supply of homes in Montana still favors sellers. The housing market in Montana has seen a remarkable surge in the past few years, with increasing numbers of people moving to the state to enjoy its scenic beauty and the many opportunities it offers. However, there is growing concern that this trend may not be sustainable and that a housing market crash could be on the horizon.

Several factors are contributing to this concern. First, the rapid increase in home prices in Montana is making it increasingly difficult for many people to afford to buy a home. While this may not be a problem for those who can afford to pay high prices, it is likely to limit the number of potential buyers in the market, which could lead to a slowdown in demand.

Second, the inventory of homes for sale in Montana has been declining in recent months, which has put upward pressure on prices. This trend is particularly pronounced in popular markets like Bozeman and Missoula, where the number of homes for sale has dropped significantly in the past year. This shortage of homes is likely to lead to bidding wars, which could further drive up prices.

Third, there are concerns about the overall health of the economy, both in Montana and across the country. While the economy has been recovering from the pandemic-induced recession, there are still many unknowns, including the impact of rising inflation and the potential for future shocks to the system.

Despite these concerns, many experts believe that a housing market crash in Montana is unlikely in 2023. While there are certainly risks to the market, there are also several factors that are likely to support continued growth.

First, the population of Montana is expected to continue growing in the coming years, which is likely to support the ongoing demand for housing. This growth is driven in part by the state's reputation as an outdoor paradise, which is attracting people from all over the country.

Second, the state's economy is generally healthy, with low unemployment rates and a diverse range of industries. While there are certainly risks to the economy, including the potential for inflation and supply chain disruptions, the overall outlook is positive.

Finally, the Montana housing market has proven to be resilient in the face of past economic downturns. While there are certainly no guarantees, the strong fundamentals of the market suggest that it is well-positioned to weather any storms that may come its way.

Overall, while there are certainly risks to the Montana housing market, the outlook for 2024 and 2025 is generally positive. While there may be some bumps in the road, the state's strong fundamentals and growing population are likely to support continued growth in the years to come.

Top Real Estate Markets in Montana

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Southern California Market Shift: Rising Rates Cool the Market

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CoreLogic recently released their monthly report on the Southern California Housing Market for March 2024, shedding light on the state of residential real estate in the region. According to Dr. Selma Hepp, CoreLogic's chief economist, the market continues to face challenges, including high mortgage rates and affordability issues, leading to a stagnation in sales activity.

Southern California Market Conditions:

Despite solid buyer demand, the Southern California housing market is grappling with various obstacles, including a scarcity of inventory and sellers reluctant to list their properties amidst favorable mortgage rates and tax benefits. This reluctance contributes to a frozen sellers’ market, limiting the number of homes available for sale and further driving up prices.

Median Home Prices:

The median sales price for properties across Southern California stood at $753,000 in March 2024, marking a notable year-over-year increase of 7.6% for the region. All six counties within Southern California observed gains in median home prices compared to the previous year. Notably, Orange County recorded the highest median sales price at $1.15 million, followed by San Diego, Los Angeles, Ventura, Riverside, and San Bernardino counties.

The total median sales price for Southern California increased from $700,000 in March 2023 to $753,000.

Regional Trends:

Orange County stands out as the priciest market in Southern California, reflecting a robust housing demand and limited inventory. Conversely, San Bernardino County boasts more affordable housing options, attracting buyers seeking lower-priced properties.

County-wise Changes for Home Prices

  • Los Angeles County: The median sales price in Los Angeles County rose from $800,000 in March 2023 to $850,000 in March 2024, indicating a 6.3% increase.
  • Orange County: Orange County saw a significant jump in its median sales price, soaring from $980,000 in March 2023 to $1,150,000 in March 2024, marking a 17.3% increase.
  • Riverside County: In Riverside County, the median sales price increased from $535,000 in March 2023 to $577,000 in March 2024, representing a 7.9% rise.
  • San Bernardino County: San Bernardino County experienced a modest increase in its median sales price, climbing from $480,000 in March 2023 to $500,000 in March 2024, indicating a 4.2% rise.
  • San Diego County: The median sales price in San Diego County surged from $790,000 in March 2023 to $865,000 in March 2024, reflecting a 9.5% increase.
  • Ventura County: Ventura County witnessed a rise in its median sales price from $775,000 in March 2023 to $825,000 in March 2024, with a 6.5% increase.

County-wise Home Sales Volume Changes

  • Los Angeles County: Home sales volume in Los Angeles County dropped from 4,965 in March 2023 to 4,517 in March 2024, reflecting a -9.0% decline.
  • Orange County: Orange County experienced a marginal decrease in home sales volume from 2,078 in March 2023 to 2,066 in March 2024, marking a -0.6% change.
  • Riverside County: Riverside County saw a decline in home sales volume from 3,168 in March 2023 to 2,986 in March 2024, representing a -5.7% decrease.
  • San Bernardino County: In San Bernardino County, home sales volume decreased from 2,068 in March 2023 to 1,788 in March 2024, indicating a -13.5% drop.
  • San Diego County: San Diego County reported a decline in home sales volume from 2,538 in March 2023 to 2,306 in March 2024, showing a -9.1% decrease.
  • Ventura County: Ventura County recorded the largest decline in home sales volume across the region, dropping from 601 in March 2023 to 513 in March 2024, marking a -14.6% decrease.

Housing Prices Are Predicted to Fall in 2024: A Bold Forecast

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Renowned analyst Meredith Whitney, known for her astute predictions that foreshadowed the 2008 financial crisis, is making headlines again. This time, she is forecasting a significant shift in the real estate landscape. According to Yahoo News, Whitney predicts that housing prices are poised to decline, starting in 2024, in a manner that could reshape the housing market across the United States.

Housing Prices Projected To Fall in 2024

In an exclusive interview during the Yahoo Finance Invest Conference, Whitney shared her insights into the factors driving this bold forecast. She believes that a “silver tsunami” of baby boomers looking to downsize will set the stage for this monumental change. Citing estimates from AARP, Whitney points out that over 70% of U.S. homes are currently owned by people aged 50 or older. A staggering 51% of this demographic is expected to downsize to smaller homes, flooding the market with more than 30 million housing units.

This impending shift is projected to create a significant supply-demand dynamic alteration. Whitney foresees this transformation beginning late next year and extending into 2025, marking the onset of a multi-decade cycle. The aging demographic holds substantial home equity, and even with mortgage rates hovering around 8%, they are unlikely to be deterred, given their lower mortgages or outright ownership. However, this transition introduces a new risk – the potential lack of younger buyers. Sellers may consequently lower prices to expedite sales, creating a mismatch with prevailing mortgage rates.

Challenges in the Housing Market and the Banking System

Beyond her housing market predictions, Whitney also shared her concerns regarding the banking system. She criticized new capital requirements proposed by the Federal Reserve and other regulators, asserting that these measures could shift consumer lending from traditional banks to unregulated areas, impacting overall credit availability. She emphasized the need to ensure that communities are not deprived of access to credit.

Whitney's insights have created ripples in the financial world, as her past predictions have been notably accurate. Her unique perspective suggests that a significant transformation is on the horizon in the real estate sector, potentially reshaping the housing market in unforeseen ways.

Where Are Housing Prices Falling 2022?

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Fortune reached out Moody's Analytics to get access to its latest proprietary housing analysis. The financial intelligence business predicted home price changes in 414 markets between 2022 and 2024. Moody's Analytics expects that 210 of the nation's 414 major housing markets will see home prices falling in the next two years and 204 will see home prices rise. 183 of the 413 biggest U.S. home markets are “overvalued” by more than 25%. Boise, Idaho, is 71.7% overvalued, and Flagstaff, Arizona, is 60.6%.

Redfin revealed its “risk score” on Friday, which identifies the home markets that are most vulnerable to a “housing slump.” The greater a market's “risk score,” the more likely it is that house prices will fall year over year.  Redfin examined 98 regional housing markets and evaluated indicators such as home-price volatility, average debt-to-income ratio, and home-price growth. Among the 98 markets measured by Redfin, Riverside had the highest likelihood of seeing a “housing downturn.”

It was followed by Boise, Cape Coral, North Port, Las Vegas, Sacramento, Bakersfield, Phoenix, Tampa, and Tucson. Popular migration destinations where home prices soared during the pandemic, such as Boise, Phoenix, and Tampa, are most likely to see the effects of a housing downturn amplified and year-over-year home prices decline if the economy enters a recession, a scenario that some economists believe is likely as inflation persists and stock markets stumble.

<<<Also Read: Will the Housing Market Crash? >>>

Homeowners in those markets who are considering selling should market their properties as soon as possible to avoid price drops. Rust Belt cities like Cleveland and Buffalo, which are still inexpensive, are the most resilient to a housing market crash. The U.S. housing market slowed significantly in the spring due to rising mortgage rates. Redfin studied which metros are most vulnerable to home-price reductions if the country enters a recession and which are most immune to an economic slump.

Recession-proof northern metros, including Cleveland and Buffalo, NY, are relatively inexpensive. Prospective homebuyers in these places can proceed with confidence. Redfin's examination of 98 U.S. metros with relevant data utilizes home-price volatility, average debt-to-income ratio, and home-price growth. Each metro is given an overall risk score relative to the others. 100 indicates the highest possibility of a housing market slump, including home-price decreases, while 0 indicates the lowest.

“Recession fears are escalating, mostly because the Fed has signaled it will continue to raise interest rates to tame inflation and cool consumer demand. Higher interest rates led to surging mortgage rates, which have already cooled down the housing market,” said Redfin Senior Economist Sheharyar Bokhari. “If the U.S. does enter a recession, we’re unlikely to see a housing-market crash like in the Great Recession because the factors affecting the economy are different: Most homeowners have a fair amount of home equity and not much debt and unemployment is low.”

Housing Markets at Risk of Falling Home Prices

If the U.S. enters a recession, Riverside's home market will chill the most. It has the highest danger score of any major U.S. city, 84. It's more likely than other metros to see prices drop year over year during a recession or economic slowdown, according to housing and economic statistics. Riverside, which includes San Bernardino, Ontario, and Palm Springs, has variable house values and was a favorite location during the epidemic for both permanent movers and second-home buyers.

Riverside is followed by Boise (76.9), Cape Coral, FL (76.7), North Port, FL (75), and Las Vegas (74.2).

Sacramento, CA (73.1), Bakersfield, CA (72.2), Phoenix (72), Tampa, FL (70.7), and Tucson, AZ (70.1) round out the top 10.

Many of these housing markets, like Riverside, are popular migration destinations or have quickly growing property prices, both of which increase their likelihood of a housing slump. Boise, Cape Coral, North Port, Las Vegas, Sacramento, and Phoenix were among the 20 fastest-cooling areas in May when mortgage rates reached 5.5%. As the economy continues to decline, prices may fall in many of these metros. Six of the 10 areas most at risk of downturns are among the most popular destinations for Redfin.com users moving from one metro to another.

Maricopa County (Phoenix) and Riverside County gained more residents from other parts of the U.S. than anywhere else in 2021, according to the U.S. Census. The most vulnerable metros have likewise seen an outsized price rise. North Port has the nation's fastest-growing house values, up 30.5 percent year over year in May, followed by Tampa (28.1 percent) and Las Vegas (26.8 percent ). Overall, nine of the ten most vulnerable locations had faster-growing house values than the national median (the exception is Sacramento, however, home prices there rose more than 40% throughout the pandemic, reaching $610,000 in May 2022).

Several of those metros went from inexpensive to unaffordable during the epidemic, owing in part to the migration of individuals from other locations. Among them is Boise, where the typical home price increased from $330,000 to $550,000 between May 2020 and May 2022, and Phoenix, where it increased from $300,000 to $485,000.

“Boise’s market is already turning around, as a lot of the people who moved to Idaho during the pandemic are either moving back to their hometowns or cashing in and moving to more affordable places. The housing market was hot during the pandemic, largely because of out-of-town buyers,” said Boise Redfin agent Shauna Pendleton.

Three at-risk metros are in California and three in Florida. San Jose, Oakland, and San Francisco experienced relatively moderate price increases throughout the epidemic, its people tend to have high salaries and considerable home equity, and their housing markets started falling fast in the first half of 2022, mainly owing to collapsing tech stocks. Not all homes in these metros will lose value. Large single-family houses in spread-out areas are recession-proof.

Housing Markets in Which Prices Are Unlikely to Fall

Relatively affordable Rust Belt metros are most resilient in the face of a recession. In case of a recession, Akron, Ohio has the lowest risk of experiencing a housing decline. It has the lowest total risk score of any major US city at 29.6. Low home-price volatility, a low debt-to-income ratio, a small number of second houses, and the fact that properties in Akron are unlikely to be flipped are some of the characteristics that make the city relatively stable.

With an overall risk score of 30.4, Akron is followed by Philadelphia, Montgomery County, PA (31.4), El Paso, TX (32.2), and Cleveland (32.4). The top ten include Cincinnati (32.6), Boston (32.6), Buffalo, NY (33.1), Kansas City, MO (33.4), and Rochester, NY (34.4). Almost all of those metros are inexpensive and have relatively slow-increasing prices, both of which would benefit their housing markets in the event of a recession.

Almost all of the most resilient metros are located in the northern United States, either in the Rust Belt or on the East Coast. Three of them are in Ohio, two in New York, and two in Pennsylvania. In nine of the ten most resilient metros, prices climbed at a slower rate than the national average (El Paso is the exception).

Seven of the 10 metros least in danger of a housing downturn had a median sale price below $300,000 in May, and nine of them were below the $431,000 national median. Affordability benefits property markets in a recession because more people can buy houses, and such locations may attract out-of-town buyers. Boston is pricey, although property prices climbed modestly throughout the epidemic. It's busy and lost residents as remote work became prevalent.

U.S. Metros Most and Least Susceptible to a Housing Downturn in the Next Recession

Ranked by highest to the lowest chance of a housing downturn. The ranking combines 10 indicators to come up with an overall risk score for each metro, relative to the other metros in this analysis. The highest possible score is 100 and the lowest possible score is 0. The indicators are as follows: home price volatility, average debt-to-income ratio, average home-loan-to-value ratio, labor market shock, percent of homes flipped, how much the housing market is “cooling” compared with other metros, the year-over-year change in domestic migration, the share of homes in the metro that are second homes, year-over-year price growth and elasticity of supply. Each factor is weighted equally.

U.S. Metro Area

 Overall Score Average Home-Loan-to-Value Ratio, 2021 Percent of Homes Flipped in 2021 Rank: How Quickly Housing Market Cooled in First Half of 2022 Net Domestic Migration in 2021, YoY Share of Second Homes, 2021 Price Growth in 2021, YoY
Riverside, CA 84 83% 4.50% 15 19,204 7.70% 21.00%
Boise, ID 76.9 6 6,782 6.00% 30.90%
Cape Coral, FL 76.7 81% 2.90% 11 7,345 23.40% 23.60%
North Port, FL 75 79% 4.40% 18 8,283 20.20% 23.30%
Las Vegas, NV 74.2 84% 8.30% 12 -15,143 7.60% 18.60%
Sacramento, CA 73.1 81% 5.40% 2 4,157 4.30% 19.30%
Bakersfield, CA 72.2 87% 3.80% 21 6,111 2.50% 17.30%
Phoenix, AZ 72 82% 10.30% 17 -15,530 7.20% 25.40%
Tampa, FL 70.7 85% 7.40% 22 524 8.10% 19.60%
Tucson, AZ 70.1 84% 7.70% 54 -2,677 7.10% 21.50%
San Diego, CA 69.8 81% 5.30% 8 -8,189 3.70% 17.50%
Jacksonville, FL 69.3 85% 7.20% 36 4,136 6.20% 16.60%
Stockton, CA 68.2 84% 4.70% 5 3,578 1.00% 19.30%
Knoxville, TN 67 86% 4.60% 13 4,527 5.20% 18.30%
Orlando, FL 63.8 85% 6.40% 31 -6,536 8.70% 16.70%
Charleston, SC 63.4 85% 3.80% 67 -2,921 7.60% 15.40%
West Palm Beach, FL 63.3 80% 3.10% 30 972 12.00% 17.40%
Fresno, CA 60.6 85% 4.70% 37 2,719 2.90% 17.90%
Raleigh, NC 60.4 83% 8.90% 42 3,430 2.60% 17.50%
Oxnard, CA 59.8 79% 2.50% 28 323 3.30% 16.70%
Salt Lake City, UT 57.7 -3,020 2.00% 22.80%
Columbia, SC 56.9 90% 4.40% 2,296 3.20%
Providence, RI 56.6 85% 2.70% 44 3,664 3.90% 15.40%
Atlanta, GA 56.4 86% 9.90% 47 -4,229 2.20% 19.20%
Miami, FL 56.3 82% 2.90% 53 -5,120 5.90% 18.60%
Charlotte, NC 56.1 85% 10.10% -6,444 2.70% 16.50%
Virginia Beach, VA 55.8 92% 3.20% 80 864 3.40% 8.30%
Tacoma, WA 55.5 9 -3,571 1.70% 19.80%
Detroit, MI 54.8 87% 5.20% 70 -2,062 1.00% 15.40%
Los Angeles, CA 54.8 79% 4.10% 46 -69,329 1.90% 17.30%
Austin, TX 54.6 16 -8,609 3.90% 31.60%
Portland, OR 54.3 82% 3.70% 14 -17,716 2.30% 15.40%
Anaheim, CA 53.9 76% 4.50% 20 -6,644 3.80% 16.00%
Denver, CO 53.8 82% 6.90% 7 -18,063 2.40% 16.70%
Colorado Springs, CO 53.7 87% 5.00% 693 2.50%
Baton Rouge, LA 52.4 89% 3.00% 2,287 2.40% 9.80%
Greenville, SC 52.1 85% 3.50% 32 1,771 4.70% 14.00%
Winston-Salem, NC 51.9 87% 5.10% 2.70% 13.70%
Grand Rapids, MI 51.7 86% 3.60% 29 1,028 2.40% 15.20%
Greensboro, NC 51.7 87% 6.70% 38 -181 2.10% 11.80%
Warren, MI 50.5 86% 2.90% 35 6,180 1.60% 11.40%
Tulsa, OK 50.1 88% 3.40% 45 2,325 2.10% 12.50%
Fort Lauderdale, FL 49.9 82% 3.00% 72 -5,121 7.50% 13.30%
Fort Worth, TX 49.6 50 1,978 1.70% 18.30%
Nashville, TN 49.3 84% 8.30% 48 -6,093 3.40% 17.00%
Allentown, PA 48.6 87% 2.20% 62 3,722 3.40% 14.20%
Camden, NJ 47.9 88% 3.00% 75 4,300 0.50% 17.90%
Houston, TX 47.7 24 -334 2.90% 15.50%
Seattle, WA 47.6 79% 1.90% 4 -37,365 1.80% 17.20%
Nassau County, NY 47.4 80% 3.60% 58 12,296 4.70% 15.20%
Albuquerque, NM 46.8 -1,714 2.80%
New Orleans, LA 46.6 88% 2.90% 23 -3,930 3.40% 10.70%
San Antonio, TX 46.6 40 -138 2.90% 15.10%
San Jose, CA 46.4 74% 2.50% 1 -22,661 0.80% 13.60%
San Francisco, CA 46.3 72% 1.90% 10 -55,918 2.40% 4.80%
Oakland, CA 45.8 78% 2.60% 3 -23,280 1.00% 16.30%
Dallas, TX 45.4 40 -5,685 1.70% 17.90%
Richmond, VA 45.4 87% 3.70% 59 1,995 1.40% 12.30%
Oklahoma City, OK 45.3 88% 5.10% 52 476 1.70% 10.60%
Washington, D.C. 44.2 87% 2.50% 28 -35,800 1.50% 10.10%
New Haven, CT 44.1 87% 2.00% 82 4,492 1.90% 15.80%
Birmingham, AL 43.4 88% 5.90% 68 95 1.40% 8.40%
Little Rock, AR 43.1 89% 4.90% 43 472 1.80% 10.70%
Frederick, MD 42.9 84% 2.00% 25 -58 0.90% 11.70%
Memphis, TN 42.7 87% 7.50% 33 -535 1.20% 13.30%
Honolulu, HI 42.6 79% 0.50% 19 6.20% 7.80%
St. Louis, MO 42.2 86% 3.40% -2,214 1.30% 10.10%
Baltimore, MD 41.9 86% 2.60% 74 6,085 1.40% 8.50%
Bridgeport, CT 41.7 81% 1.10% 88 8,871 2.00% 11.60%
Worcester, MA 40.8 86% 1.80% 57 3,354 1.20% 16.10%
Indianapolis, IN 39.9 41 902 1.40% 13.50%
Newark, NJ 39.3 84% 1.90% 73 7,348 2.80% 13.20%
Wichita, KS 39.3 -1,813 1.10% 12.50%
Lake County, IL 38.6 85% 1.80% 87 2,746 1.70% 14.40%
Louisville, KY 38.6 87% 4.80% 34 -378 1.20% 9.70%
Wilmington, DE 37.8 88% 2.80% 64 738 1.80% 11.30%
Hartford, CT 36.8 86% 1.70% 80 7,182 1.80% 12.00%
Minneapolis, MN 36.8 85% 3.70% 50 -10,673 1.30% 11.10%
Gary, IN 36.7 939 1.20% 9.70%
Pittsburgh, PA 36.4 87% 1.60% 76 -337 1.50% 12.70%
Elgin, IL 35.8 84% 1.10% 60 3,590 0.60% 11.50%
New York, NY 35.4 78% 1.70% 48 -2,01,570 2.80% 12.30%
Syracuse, NY 35.2 86% 2.20% 1,510 3.30% 11.00%
Milwaukee, WI 35.1 86% 3.30% 79 -2,993 1.40% 7.20%
Omaha, NE 35.1 87% 4.90% 56 -237 1.30% 9.70%
Albany, NY 34.5 87% 2.00% 90 3,521 2.80% 13.70%
Chicago, IL 34.4 86% 1.80% 70 -32,998 1.30% 11.70%
Columbus, OH 34.2 85% 3.40% 61 2,507 1.40% 13.50%
Rochester, NY 34 85% 2.00% 86 1,330 3.20% 12.60%
Kansas City, MO 33.4 -1,491 1.30% 10.90%
Buffalo, NY 33.1 86% 2.60% 78 1,877 1.40% 17.00%
Boston, MA 32.6 79% 1.20% 63 -23,964 2.80% 12.20%
Cincinnati, OH 32.6 87% 3.90% 84 -360 1.30% 13.90%
Cleveland, OH 32.4 86% 2.50% 71 225 1.20% 9.50%
El Paso, TX 32.2 89 -24 1.80% 13.90%
Montgomery County, PA 31.4 83% 1.80% 66 6,685 0.80% 11.00%
Philadelphia, PA 30.4 86% 2.00% 64 -15,721 1.40% 10.10%
Akron, OH 29.6 87% 2.70% 83 2,029 1.20% 7.90%

 

Source: https://www.redfin.com/news/metros-recession-risk-housing-downturn-2022/

What Can Foreign Investors Teach Us About Our Own Country?

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You’ve seen the headlines. The combination of lower prices, increased rents and a weak dollar are drawing investor capital from all around the globe and funneling it into American housing.  According to NAR, foreign investment is US real estate has increased by 20% in the 12 months ending march 2011, totaling $82 billion in just one year. What’s missing in most of these stories is why.

Why are overseas real estate investors, who are standing thousands of miles away with little if any personal experience in US real estate, pouncing on this opportunity? Low prices and great exchange rates don’t explain it. If you hear of a stock that has plummeted, would you buy it based on that fact alone? Or would you want to understand the fundamentals of the company behind the stock. What do they produce? Who are their customers? Why should you believe this investment will pay off, as opposed to seeing the new low price as an accurate reflection of the value of the company? In other words, if it’s a piece of junk, you wouldn’t care how cheap it is.

[Read more…]

2012 Housing Market Forecast

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The question most real estate investors often ask is, “Where do I invest now?”

As always, there are local housing markets around the country where homes are affordable, the underlying economy is strong, and appreciation is imminent.  These are markets you should consider for your next long-term real estate investment.

Norada Real Estate Investments tracks the economic conditions and real estate trends of nearly 400 markets across the country.  Because of the dynamic nature of real estate market conditions, we continually monitor and rank the top markets to make it easier for you, as an investor, to concentrate on the areas that will give you the greatest opportunity for success.

While you might be inclined to look for bargains in areas that have seen the largest price corrections in the past, watch out – there is no guarantee that home prices in areas of high speculation will ever rebound to boom levels.

Unlike the stock market, local real estate markets usually move in slow, predictable cycles. Appreciation is not luck or magic. It correlates closely with economic development and population growth in a local market.

If you missed out on Phoenix, Vegas and Florida (or if you rode those waves and know what it's about), download the current issue of our free report.

Download your free copy of the 2012 Housing Market Forecast Today!

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