In this article, we will be navigating through the housing market in the United States while covering the 25 cities where home prices are rising despite the high mortgage rates. If you wish to skip our detailed analysis, you can move directly to the 5 Cities Where Home Prices Are Rising Despite the High Mortgage Rates.
Housing in the US: An Overview
The US housing market has been subject to a crisis where the existing supply of houses is unable to meet the demand. Soaring home prices have resulted in housing affordability concerns for Americans. Those who own houses are waiting for the market to go back to normal since they will have to pay a higher mortgage on a new house. On November 7, CNN reported that the US housing market has been the least affordable since 1984. Many of the first-time buyers have given up on the idea of owning a house by choosing to rent one instead. The price-to-income ratio is worse as the average home cost continues to rise as compared to median incomes.
Real Estate Options to Seek
Amid a tight supply and high mortgages, American home construction companies such as LGI Homes, Inc. (NASDAQ:LGIH), Beazer Homes USA, Inc. (NYSE:BZH), and PulteGroup, Inc. (NYSE:PHM) enable many Americans to settle in decent locations for affordable prices. Let’s take a look at recent developments by these companies.
LGI Homes, Inc. (NASDAQ:LGIH) engages in the design, construction, and sale of homes across 36 markets in 21 states. The company has closed more than 65,000 homes in its history. On December 14, LGI Homes, Inc. (NASDAQ:LGIH) reported the opening of two new communities in the Houston market. The first community, Emberly, is situated near the shopping, dining, and entertainment centers of Rosenburg, Richmond, and Sugar Land. Residents can access the pool and clubhouse, splash pad, pickleball courts, and a dog park. Homes at Emberly start at around $290,000. Wayside Village, the other community, offers new, move-in-ready homes in northeast Houston. Downtown Houston is also close by. These homes start at around $220,000.
Beazer Homes USA, Inc. (NYSE:BZH) is a leading homebuilder in the United States. It currently builds houses in multiple states including Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, North Carolina, South Carolina, Tennessee, Texas, and Virginia. On December 7, Beazer Homes USA, Inc. (NYSE:BZH) announced the launch of its Energy Series READY Homes in its first Southern California community in Corona, California. The firm was the first US national homebuilder to publicly commit to meet the requirements of the US Department of Energy’s (DOE) Zero Energy Ready Home program by the end of 2025. The program aims to achieve at least 40% to 50% greater energy efficiency than a typical new home. Each READY home built at the new community will be certified as a Zero Energy Ready Home.
PulteGroup, Inc. (NYSE: PHM) is another popular American homebuilder. The company’s brand Pulte Homes constructs consumer-inspired homes and communities in more than 40 markets across the US. On December 7, PulteGroup, Inc. (NYSE: PHM) announced the grand opening of Barrow Farms, an intimate community located in Kernersville. The designs range from 2,242 to 3,024 square feet. The homes feature floor plan options offering 3-4 bedrooms, flex space, 2-car garages, and expansive homesites of 1 acre. Hence, Pulte Homes is the only builder in Kernersville with homesites of this size. Multiple retail, dining, and entertainment venues are located minutes away from the community. Homes at Barrow Farms are priced from the mid $300,000s.
Now that we have taken a look at the housing dynamics in the US, let’s move to the 25 cities where home prices are rising despite the high mortgage rates. You can also view the most affordable housing markets in the US in 2023.
25 Cities Where Home Prices Are Rising Despite the High Mortgage Rates
Our Methodology:
In order to compile a list of the 25 cities where home prices are rising despite the high mortgage rates, we acquired data from Realtor, a leading real-estate source. Realtor reports on local market trends around the United States. The most recent data was available from November. The median list price is the middle value of all the homes listed for sale in a given area and hence, it better indicates the current state of the housing market. In order to depict the increasing prices, we selected the year-over-year increase in the median list price as our metric. We included metros all over the United States for this research.
Finally, we ranked the 25 cities where home prices are rising despite the high mortgage rates in ascending order of their increase in median list prices, year-over-year.
25 Cities Where Home Prices Are Rising Despite the High Mortgage Rates
25. Yankton, South Dakota
Year-Over-Year Median List Price Increase: 35.8%
As of November, the median list price in Yankton is $332,500. This price has increased by 35.8% since last year. Hence, home prices have been on the rise in Yankton.
24. Defiance, Ohio
Year-Over-Year Median List Price Increase: 36.0%
With an increase in its median list price by 36%, Defiance ranks as one of the US cities where home prices are rising. As of November, the median list price in the city is $200,000.
23. Cadillac, Michigan
Year-Over-Year Median List Price Increase: 36.1%
According to Realtor, Cadillac witnessed a year-over-year increase in its median list price by 36.1%. The Michigan-based city has a median list price of $249,950, as of November.
22. Madison, Indiana
Year-Over-Year Median List Price Increase: 38.0%
As of November, the median list price in Madison is $303,450. There has been an increase in the median list price by 38% since November 2022. Thus, Madison has also seen rising home prices despite the high mortgage rates.
21. Pecos, Texas
Year-Over-Year Median List Price Increase: 39.6%
Pecos saw an increase of 39.6% in its median list price since November 2022. Hence, it qualifies for the 25 cities where home prices have been climbing although the mortgage rates have been high.
20. Forrest City, Arkansas
Year-Over-Year Median List Price Increase: 41.1%
With a 41.1% year-over-year increase in median list price, Forrest City ranks as one of the 25 cities where home prices are rising. As of November, the median list price in the city is $151,625.
19. Winona, Minnesota
Year-Over-Year Median List Price Increase: 42.2%
As reported by Realtor, the median list price in Winona is $357,000, as of November. There has been a 42.2% rise in this median list price since November 2022. Hence, home prices have also climbed in Winona.
18. Warren, Pennsylvania
Year-Over-Year Median List Price Increase: 42.5%
Although the median list price in Warren is $188,500 as recorded in November, it has gone up by 42.5% since last year. This makes Warren another US city with rising home prices.
17. Deming, New Mexico
Year-Over-Year Median List Price Increase: 42.7%
Deming is one of the 25 American cities where prices of homes have been increasing despite the high mortgage rates. As of November, the city recorded an increase in its median list price by 42.7%.
16. Americus, Georgia
Year-Over-Year Median List Price Increase: 42.9%
As of November, the median list price in Americus is $249,925. This price went up by 42.9% since November 2022. This ranks Americus among other US cities with soaring home prices.
15. Sandusky, Ohio
Year-Over-Year Median List Price Increase: 44.8%
The Ohio-based city of Sandusky has been experiencing an increase in home prices. The year-on-year rise in median list price in the city is 44.8%. The median list price in the city is $325,000, as of November.
14. Bartlesville, Oklahoma
Year-Over-Year Median List Price Increase: 45.3%
As of November, the median list price in Bartlesville is $239,000. This price has gone up by 45.3% since 2022. Hence, home prices have been increasing in Bartlesville.
13. Coshocton, Ohio
Year-Over-Year Median List Price Increase: 45.8%
With a 45.8% year-over-year increase in median list price, Coshocton ranks among other cities where prices for homes have been on the rise. The median list price in the city is $206,197, as of November.
12. Sunbury, Pennsylvania
Year-Over-Year Median List Price Increase: 47.8%
The median list price in Sunbury is $146,675 as recorded in November. This price went up by 47.8% since November 2022. This makes Sunbury another city with increasing home prices.
11. Maysville, Kentucky
Year-Over-Year Median List Price Increase: 49.7%
Maysville is one of the 25 US cities where home prices have been on the rise although the mortgage rates are high. The year-over-year rise in median list price in Maysville is 49.7%. As of November, the median list price in the city is $261,100.
10. Logansport, Indiana
Year-Over-Year Median List Price Increase: 49.8%
Logansport recorded a year-over-year increase of 49.8% in its median list price. As of November, the median list price in the city is $194,600. Hence, Logansport ranks among the US cities where home prices have been increasing.
9. Steamboat Springs, Colorado
Year-Over-Year Median List Price Increase: 51.5%
Steamboat Springs is a large city based in northwestern Colorado which has seen a rise in home prices. As of November, the year-on-year increase in the median list price in the city has been recorded at 51.5%.
8. Sikeston, Missouri
Year-Over-Year Median List Price Increase: 56.5%
Sikeston is another city to rank among the 25 cities where house prices are rising despite the high mortgage rates. As of November, the median list price in Sikeston is $164,225. This price grew by 56.5% year-over-year.
7. Marshall, Minnesota
Year-Over-Year Median List Price Increase: 61.1%
Home prices have also been on the rise in Marshall which is based in Lyon County, Minnesota. The city records a 61.1% year-over-year rise in its median list price, as of November. The median list price in Marshall is $225,500.
6. Van Wert, Ohio
Year-Over-Year Median List Price Increase: 62.3%
Vanwert is a city in northwestern Ohio where home prices have been soaring. As of November, the city has a median list price of $240,950. This price has experienced an increase of 62.3% since November 2022.
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Disclosure: None. 25 Cities Where Home Prices Are Rising Despite the High Mortgage Rates is originally published on Insider Monkey.
