With 30-year fixed-rate mortgages climbing toward 8% and limited inventory available, there is plenty to be scared of in the housing market for prospective buyers. In honor of Halloween, Point2Homes analyzed the largest 200 housing markets in the country to determine the scariest markets, based on median price, year-over-year differential in home prices, differences in for-sale inventory, and fewest days on the market.
The analysis found that large markets in California are the most frightening, while Southeast markets are less daunting by comparison. Nine of the 10 scariest markets are in California, including Sunnyvale, Escondido, San Jose, Chula Vista, and Oceanside. Additionally, eight of the 10 most expensive markets for home buyers are in California, with price tags in excess of $1.1 million.
Bellevue, Washington, is the scariest non-California market, according to Point2Homes, in part due to an 18% year-over-year increase in prices combined with a 20% decrease in housing inventory.
At the other end of the list, cities such as Jackson, Mississippi; Birmingham, Alabama; and New Orleans are ranked as least scary. In the Sun Belt region, homes are priced below the national average of $420,000, several markets reported year-over-year price declines, and inventory has increased compared with 2022. Little Rock, Arkansas, and Detroit round out the top five least scary markets.
In addition to the rapid price appreciation at the top of the list, several markets known for their affordability experienced price gains on a year-over-year basis. Home buyers in Louisville, Kentucky; Tallahassee, Florida; and Kansas City, Kansas, now face home prices that are more than 20% higher than in 2022. Charleston, South Carolina; Tampa, Florida; Escondido; Bellevue; Macon, Georgia; Naperville, Illinois; and Hollywood, Florida, are the other markets with highest home price appreciation compared with 2022. Each of the top 10 markets has seen prices in 2023 grow by at least 16% compared with last year.
While prices are one hurdle facing prospective buyers, the availability of homes is also a major challenge in the current market. In 28 of the 200 largest U.S. markets, housing stock has been halved since 2022, with California’s Fremont and Sunnyvale markets now selling around 60% fewer homes than a year ago. Inventory has also decreased significantly in Spring Valley, Nevada; Chandler, Arizona; and Gilbert, Arizona.
Rampant demand is also likely contributing to low inventory levels across the country: 19 large markets reported homes flying off the market in 10 days or less. In Grand Rapids, Michigan, and Lakewood, Colorado, active listings last less than a week on average, according to Point2Homes. Homes take the longest to sell in New Orleans; Manhattan, New York; Patterson, New Jersey; Bronx, New York; and Honolulu, with median days on the market in each of the five cities exceeding 62.