Spring brought a new crop of hottest housing markets, with some repeats and a couple new names to the list, according to the latest Top Single-Family Housing Markets Report from Ten-X, an online real estate marketplace.
The top five markets displayed the most consistent combination of rising home prices, home appreciation, favorable affordability and positive economic and demographic conditions for future demand.
Seattle and Portland’s place in the top five represent the dominance of the Pacific Northwest driven largely by the technology sector, according to the report. The success in their housing markets is largely accredited to their local economic strength and healthy demographic trends.
The top markets in Florida demonstrate the ongoing recovery that continues to take place throughout the state.
"We're continuing to see a return to fundamentals driving the housing market, as cities with above average population growth and job creation are recovering much more rapidly," Ten-X Executive Vice President Rick Sharga said.
"The solid tech sector has helped cities like Seattle and Portland maintain strong economic growth, which in turn has helped fuel the housing market, and the Florida housing market continues its post-recession recovery with South and Central Florida cities experiencing explosive growth," he cont
Here are the top five “hottest” markets for Spring 2016
5. Fort Lauderdale, Florida
Although dropping in rank from the last report, Fort Lauderdale remains in the top five after erasing the devastation of the deep downturn that accompanied the housing crisis. The city’s local employment is up 3.1% from last year, and its largest sector, the professional/business services had an employment increase of 7.7%.
Seasonally adjusted median sales are up 8% at $226,000.
Housing prices show room for advancement at 22% below their previous peak. Although inventory is expected to remain small, purchasing a single-family home is still more affordable than apartment rentals.
4. Palm Beach County, Florida
Palm Beach’s pace has slowed since 2014. However, its market continues to improve. Seasonally adjusted employment is up 2.5% annually, with the professional/ business service sector increasing 6.7%. Alternatively, the outsized financial services sector declined by 4.5%, and the leisure/hospitality sector decreased by 2.1%.
Overall, the market continues to improve. Home prices increased by 14.1% from last year, the second highest increase in U.S. metros in the fourth quarter. The current median single-family home price is $247,000.
In fact, Palm Beach County ranks in the top 20 nationally for high-end sales in 2015, or transactions that start at $10 million, according to an article by Jeff Ostrowski for myPalmBeachPost.
3. Nashville, Tennessee
Nashville is back in the top five for the first time in a year, according to the report. Nashville’s success is credited in part to its gains from areas such as education/healthcare services, which saw payrolls increase by 3.9% from last year. Employment grew 6.2% annually due to downtown construction projects.
Median home prices are up 23.6% from their prior peak, and 11.6% from last year. Despite worries that the city is overbuilding, homes have remained affordable. Its population gain of 1.9% is more than double the national rate.
According to the Census Bureau, middle Tennessee gains about 100 people every day, including new births and relocations, according to an article by Adam Sichko for Nashville Business Journal.
2. Portland, Oregon
Employment in Portland reached a new high, 7.2% above its previous peak, and unemployment sits at 4.8%. The area’s largest sector, professional/business services, increased by 7.1% annually, and is now 21.5% above its previous peak. Median home sales are up by 12.4% annually, bringing the median to $331,000 in the fourth quarter. Although cheap apartment rentals create problems for affordability, the housing market in Portland continues to improve.
Many residents from San Francisco have begun migrating into Portland, Seattle, and surrounding areas in order to escape the ever increasing cost of living in San Francisco.
1. Seattle, Washington
Seattle claims the title of hottest housing market for the third time in a row, according to the report. The city even ranked among the National Association of College Employers’ top ten cities in the nation for recent college grads. The economy is booming with local payrolls up 3% annually, and the area’s tech base up 5%. For the past decade, local population growth has outpaced U.S. population growth, The most recent measurement showed population growth at 1.7%.
Median home sales prices reached an all-time high at $425,000 last quarter, up 12.1% from last year. Affordability could be an issue going forward, currently however, the market continues to see a healthy demand.