Home sales plummeted this year as housing prices and mortgage rates climbed to historic levels — but a new report suggests certain real estate markets could rebound in 2024.
Select markets in the Northeast, Midwest and Southern California are primed for sales and price growth next year, according to real estate broker Realtor.com’s new forecast. Among the cities where residential real estate is likely to be hot in 2024 are smaller, more affordable alternatives to big urban centers.
Realtor.com ranked the largest U.S. metropolitan areas based on expected sales and price growth in the coming year. Here are the results.
Where will homebuyers go in 2024?
Realtor.com anticipates the top markets in 2024 will fall into two camps: affordable midwestern and northeastern alternatives to expensive major cities, and western metropolitan areas that saw major declines in sales in 2023.
Surprisingly, half the cities ranked in the top 10 are in famously expensive California, including the Los Angeles and San Diego areas. That's because sales slumped in much of the Golden State in 2023. As the Federal Reserve backs off its rash of rate increases and mortgage rates start to decline, Realtor.com expects new inventory will allow some SoCal markets to rebound next year.
The midwestern and northern cities ranked by Realtor.com are expected to attract homebuyers for a few reasons, the biggest being that most boast median housing prices under the national median of $431,000. They have been somewhat sheltered from the impact of high mortgage rates because many homeowners in these areas have already paid off their loans, according to the report.
They offer a high quality of life for a lower cost, as well as proximity to major metropolises (like in the case of Worcester, Massachusetts, which is near Boston). Residents enjoy plenty of cultural amenities, recreational opportunities and quality schools, making them attractive for homebuyers looking for big-city features at small-town prices.
What’s more, many of these metros have robust job markets — unemployment in every midwestern and northeastern metro ranked except Toledo, Ohio, is expected to be at or below the forecasted national rate of 4.2% at the end of 2024.
Top 10 cities for expected sales and price growth in 2024
The following metropolitan areas are expected to see the biggest gains in sales and price growth next year, according to Realtor.com.
- Toledo, Ohio
- Oxnard/Thousand Oaks/ Ventura, California
- Rochester, New York
- San Diego/Chula Vista/Carlsbad, California
- Riverside/San Bernardino/Ontario, California
- Bakersfield, California
- Springfield, Massachusetts
- Worcester, Massachusetts/Connecticut
- Grand Rapid/Kentwood, Michigan
- Los Angeles/Long Beach/Anaheim, California
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