Hot Housing Markets: What They Have in Common
Over the past year, amid dozens of home price reports, several hot markets stand out.
These are markets that have seen remarkable growth and high demand for housing that, in turn, has driven up home prices-in some cases, to levels that have met and exceeded those of the pre-Great Recession era. Coastal areas such as Seattle and Portland, Ore., have seen such growth, as have other cities such as Denver (site of this October’s MBA Annual Convention & Expo) and Dallas.
Ten-X, Irvine, Calif., says these hot single-family markets share key underpinnings: superior demographic trends, bright economic outlooks and affordable housing that should enable healthy demand and generous price growth in the coming years.
“The U.S. economy continues to expand in the face of policy, monetary and international uncertainty,” said Ten-X Chief Economist Peter Muoio. “Despite some recent deceleration, the labor market is growing at a solid clip, unemployment remains low and wage growth is stronger.”
Ten-X this week released its quarterly Top Single-Family Housing Markets Report, which ranks the nation’s 50 largest housing markets according to current and forecasted housing fundamentals. Among the 50 largest US markets, the top five are Nashville, Tenn., Orlando, Fla., Fort Worth, Tex., Dallas, and San Antonio, Tex.
Ten-X said these regions earned their spots by displaying consistently strong demand, home price appreciation, favorable affordability, and economic and demographic growth. Nashville jumped from sixth to first this quarter, pushing out Tampa, which tumbled off the list to eighth. Orlando regained a spot in the top five, jumping from eighth to second. Fort Worth jumped from 12th to third, Dallas dropped two spots this quarter to fourth and San Antonio climbed from 11th to fifth.
Ten-X Executive Vice President Rick Sharga said data continued to show regional volatility. “Markets in the South and Southeast with strong job and population growth–notably Texas and Florida–continue to have a much stronger outlook than much of the Midwest and Northeast. Markets in California and the Pacific Northwest appear to be cooling down a bit as home prices have risen to levels unaffordable for many prospective buyers.”
The report said Nashville endured a modest downturn in existing home prices after the 2008 housing crash, but since then, prices in the metro have surged well beyond their prior peak. Orlando’s ranking reflects the continued opportunity for continued growth amid the protracted recovery seen across many Florida metros. Meanwhile, Texas emerged as a prominent force this quarter. Despite cooling somewhat with the onset of lower oil prices, the Dallas, Fort Worth and San Antonio markets have been resilient, with prices surging well beyond previous highs.
