Insider Monkey

20 Affordable, Promising Cities to Buy Real Estate in 2024

Zarah Hamid
9 min read

In This Article:

In this article, we will be covering the 20 affordable, promising cities to buy real estate in 2024. If you wish to skip our detailed analysis, you can move directly to the 5 Affordable, Promising Cities to Buy Real Estate in 2024.

US Real Estate Affordability: A Brief Recap

The US housing market has long been subjected to a serious housing crisis. On October 20, 2023, CNN reported that home sales hit a 13-year low in September 2023. A large proportion of would-be buyers were unable to attain a home due to soaring interest rates in addition to highly-priced houses. The monthly payment on an average-priced home required 40% of the median household income which resulted in affordability concerns.

Current Affordability Patterns and Home Price Dynamics

The New York Times has reported the aforementioned affordability crisis to persist. Home prices in the United States have climbed more than 60% in the preceding 10 years. Simultaneously, a quarter of renters in the United States tend to spend more than half of their income on housing.

On the other hand, the mortgage situation remains adverse. While mortgage rates fell through mid-January to the mid-6% range, they have started to climb again. On April 18, CNBC reported that the average rate on the 30-year fixed mortgage exceeded 7% on April 1, the highest since mid-November of 2023. Mortgage rates have been predicted to remain elevated and hence, homebuyers and owners who have been waiting for lower mortgage rates might be hanging in there for a longer period.

On April 15, Zillow reported that home values are climbing at a rapid month-over-month rate in the major and most expensive US metros. Prices have gone up by 3.3% in San Jose, 2.7% in San Francisco, 2.4% in Seattle, 2.1% in San Diego and 2.0% in Los Angeles. However, the price appreciation, in this case, becomes a dilemma for many since would-be homebuyers cannot pursue these markets due to overall high prices while existing homeowners continue to be locked into their mortgages as it is extremely costly for them to buy a home at current rates. Another issue with these markets is that the inventory has not yet grown since the pandemic’s outbreak which has driven more competition for few choices. You can also take a look at the cities with the highest home price increases since the pandemic.

Meanwhile, home price appreciation has toned down in the South where inventory has recovered since the pandemic. This has resulted in less competition and has controlled extremely high prices. On a monthly basis, metros including New Orleans, San Antonio, Tampa, Orlando, and Jacksonville experienced the slowest but still fairly solid price growths. New Orleans and Austin have seen a rise in the new listings of existing homes as compared to the pre-pandemic period.

and

Recommended Stories