Looking over Realtor.com’s rundown of the hottest housing markets in the country, two seemingly contradictory things are immediately apparent: the cities straight burning up the summer thus far are both some of the most and least expensive ones in the nation. No, this observation isn’t some poorly planned out Zen koan or Schrodinger’s cat joke, it’s happening in the numbers. On the top side, we have the perennial high dollar candidates: San Francisco and Santa Cruz, paired with exploding tech hubs and the-new-Brooklyn candidates past, present, and future (LA, Austin, and Nashville I’m looking at you). On the other side of the coin, well take a look:
Detroit, often the poster child of housing woes, is up on that list in a big way. This should be too surprising considering the amount of press and public interest in revitalizing the city, as well as the influx of investors moving in to take advantage of incredible deals on in distressed neighborhoods. Perhaps a bigger surprise comes from Stockton, California . . . the second largest city to weather municipal bankruptcy in the past decade, and among the hardest hit areas during the housing crash. Smaller inland cities in California are beginning to catch fire from Stockton to Sacramento and Yuba City, like their coastal compadres have been for months. Exploring home prices in California at the moment, it’s easy to see why: inland cities offer bigger homes without the premium price tag that comes with places along the coast.
California, here I come. Eleven of the top twenty hottest markets are in the Golden State. The next most popular state is Texas with four—less than half the number California boasts. This is in line with longstanding trends in westward movement, accelerated by the growing popularity of cities like LA, San Diego, and San Francisco since the end of the housing crash. Increased demand pushed home prices up to astronomical levels along the coast, pricing out a good percentage of rental-bound residents in the biggest coastal cities. This may explain the rising popularity of Sacramento as an alternative to high dollar living in the Bay Area.
Home prices nationwide are up 8 percent year-over-year in August averaging out at $233,000. HousingWire notes predicts that current stock market uncertainty could cool the red-hot market, allowing buyers to control the market a bit more and secure better prices on their new homes. It’s also highly likely that recent Wall Street instability will result in the Federal Reserve holding off on its scheduled interest rate hike, giving buyers a few more precious months to lock in the best rate on a mortgage.