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he housing market in the United States has been experiencing a drop in mortgage rates, but despite this, many potential buyers remain hesitant in many markets. However, some areas in the South and Southeast have been identified as promising markets for home purchases according to a recent WalletHub report. The top ten real estate markets in the report include McKinney, Texas, Frisco, Texas, Cary, North Carolina, Nashville, Tennessee, Durham, North Carolina, Gilbert, Arizona, Charlotte, North Carolina, Denton, Texas, Allen, Texas, and Port St. Lucie, Florida.
The report is based on seventeen key indicators of housing market attractiveness and economic strength, such as median home price appreciation, housing affordability, and job growth. The map provided shows the top five real estate markets in the country according to WalletHub.
WalletHub analyst Cassandra Happe emphasizes that while current home prices are important, they should not be the only factor considered when determining the health of a city's real estate market. Other factors such as cost of living, potential for home value increase, availability of recently built homes, and quality of the city's job market should also be considered along with asking prices and interest rates.
McKinney, Texas, took the top spot due to several reasons. It has a high share of houses built between 2010 and 2021 at 35 percent, which means new buyers would likely avoid major maintenance costs on their homes. It was also the 76th cheapest of the 300 cities in the study. Frisco, Texas, had the highest share of houses built between 2010 and 2021 at 42 percent and had the 15th best job growth rate in the country.
Texas has made significant progress in its real estate markets due to significant population growth and the influx of new businesses. Kevin Thompson, a finance expert and founder and CEO of 9i Capital Group, explains that Toyota moved to Plano in 2017, and other major companies like McKesson and AT&T have also established a presence in the area. The combination of low taxes and light regulation has made Texas an attractive environment for business, driving housing growth in these regions.
In North Carolina, Durham and Cary were solid housing markets due to their low costs of living and low mortgage-delinquency rates. Migration to the South and Southeast is still steady, affecting housing markets for both buyers and sellers. Prices can be significantly lower in these areas compared to where buyers previously lived.
While the pandemic-era migration to other states has settled in recent months, markets that boomed during this time are still seeing a surge in home sales. Markets in Arizona, Tennessee, Texas, and North Carolina are still seeing people moving in from more expensive cities, even though home values in these markets are at or near all-time highs.
Homebuyers across the country might be hesitant due to higher interest rates, but some real estate experts recommend buying now and refinancing later. Rosalind Greenstein, a lecturer in urban and environmental policy and planning at Tufts University, advises first-time homebuyers to take advantage of the opportunity to buy in some of the strongest markets where inventories are at historic lows.
Despite many homebuyers' complaints about the current housing market, it is unlikely to change dramatically in the next year according to Brent Smith, a Kornblau scholar at Virginia Commonwealth University. Given sufficient time, both a collapse or price boom in the housing market is likely, but dramatic swings in the housing market over the next year are unlikely unless there are dramatic events such as war, recession, or pandemic.
