What do Boston and Kansas City have in common?
According to a newly released report from the National Association of Realtors (NAR), they are among the 10 hottest spots in America’s housing market to watch in 2025.
“Homebuyers will have more success next year,” NAR chief economist and senior vice president of research Lawrence Yun said in the study. “The worst affordability challenges are over as more inventory, stable mortgage rates and continued job and income growth pave the way for more Americans to achieve homeownership.”
That said, NAR predicts that mortgage rates — which for several years have fallen to high levels to combat inflation — will stabilize near 6% in 2025, “creating a new normal.”
At that rate, the report continues, more homebuyers will enter or return to the market, with a forecast of 4.5 million existing home sales next year.
The trade association also predicts that home prices will continue to rise in 2025, albeit at a slower pace than in previous years. Increases, the study says, are likely to be about 2%, bringing the average existing home price to $410,700.
At the top of the 2025 list, due to alphabetical order, is Boston-Cambridge-Newton, Massachusetts-New Hampshire. Only the Boston area is known to be more expensive — with the entire area boasting a median home price of nearly $700,000, according to Zillow. NAR predicts the region will benefit from stabilizing mortgage rates in 2025, especially with that strength helping homeowners feel encouraged to list.
To find the 2025 markets to watch, NAR analyzed how each area performs relative to the national level on 10 economic, demographic and housing factors. Among them: the share of foreclosed homeowners (those reluctant to sell because of high fees), job growth, the average mortgage rate, the share of millennial renters who can afford to buy a home, and the share of those abroad. movers buying homes.
Next comes Charlotte-Concord-Gastonia, North Carolina-South Carolina. Over the past five years, and especially since COVID-19, the Carolinas saw a 10% increase in jobs – as well as a number of residents from across the nation heading to the area not only for employment opportunities, but also for better weather. good. Only Charlotte has an affordable housing stock, with a reported price of 43% below $324,000.
Not far from the Charlotte area is Greenville-Anderson, South Carolina – Greenville is a charming town with a lively and walkable downtown that offers easy access to hiking and biking trails for outdoor activities. The city’s $307,315 market average is up nearly 3% year over year; listings typically only stay online for 17 days.
As for Kansas City — listed in the report as Kansas City, Missouri-Kansas — its benefits include affordability and competitive financing. Its median home price of about $234,000 allows one in three millennials to own in that metro, but that figure is up 3% year over year. Additionally, nearly half of all home sales in the city came in for less than the asking price in October.
Read on for the full list.
- Boston-Cambridge-Newton, Massachusetts-New Hampshire
- Charlotte-Concord-Gastonia, North Carolina-South Carolina
- Grand Rapids-Kentwood, Michigan
- Greenville-Anderson, South Carolina
- Hartford-East-Hartford-Middletown, Connecticut
- Indianapolis-Carmel-Anderson, Indiana
- Kansas City, Missouri-Kansas
- Knoxville, Tennessee
- Phoenix-Mesa-Chandler, Arizona
- San Antonio-New Braunfels, Texas
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