West Coast communities continue to experience strong annual home price gains, with seven of the top 10 markets for year-over-year price appreciation located in that region, according to Homes.com's Local Market Index report.
One such example is the Portland-Vancouver-Hillsboro, OR-WA market, which made the top-10 highest price gains list.
But what was interesting about the June report is that month-over-month, six of the top 10 gaining markets are located in the South, two are from the Northeast and two are tied to the West. So what’s behind the transition toward southern markets?
Grand Canyon Title Agency real estate analyst Fletcher Wilcox pointed out a strong correlation between price gains and job growth in certain markets during an interview with HousingWire.
When looking at the change in job growth year-over-year in July, the Los Angeles-Long Beach-Santa Ana; Riverside-San Bernardino-Ontario; San Diego-Carlsbad-San Marcos and San Francisco-Oakland-Fremont markets all showed a decline in job growth.
However, job growth in the Phoenix-Mesa-Scottsdale market went from a 2.44% growth rate in July 2012 to a 3.11% change last month — healthy numbers no matter what market we’re looking at. The U.S. economy increased its nonagricultural jobs by 1.72% year-over-year in July.
It’s no coincidence that the Greater Phoenix housing market is thriving based solely off these numbers. “Why our prices are going up and we’re pretty dominant is because we have job growth and population growth,” Wilcox said.
Phoenix is on pace to reach its highest single-family median sales price of the year this month. The single-family median sales price in May was $200,000. In June, it reached $207,000 and is expected to reach $210,000 in the new July report. August numbers may be the best yet, with the median sales price expected to hit $213,500.