Markets

Insider Trading

Hedge Funds

Retirement

Opinion

12 Cities Where Home Prices are Going Up Right Now

In this piece, we will take a look at the 12 cities where home prices are going up right now. You can skip our discussion, business implications, and head on over to the top 5 Cities Where Home Prices are Going Up Right Now.

The housing industry has had a topsy turvy ride these past couple of years. The coronavirus pandemic became both a blessing and a disaster for the sector. While the pandemic strained household finances by reducing incomes and making it difficult for people to pay rent, at the same time, it also ushered in the revolution of remote work and enabled people to move away from expensive cities and to suburban areas where housing is cheap. At the same time, as the Federal Reserve attempted to stymie the negative effects of lockdowns on the economy by reducing interest rates, more people found out that buying a home became much easier than before.

However, as they say, there’s no free lunch. The shift to suburban areas and the low interest rates ended up significantly stimulating the industry – so much so that as life started to return to normal, home prices jumped by simply unbelievable rates. To gauge just how serious and significant this growth was, consider data from the Federal Reserve. It shows that the effect of the pandemic and the resulting recession is simply unimaginable unless you study the data. The central bank’s analysis reveals that housing prices in America jumped by a whopping 19.3% in July 2021. This was nearly five times the rate at which they had grown during the years before the pandemic and a two decade high at the least.

The Fed believes that the reasons behind this shift were easy access to credit, a larger proportion of home buyers on the market, and a tight supply market that contributed to scarcity and made existing property more valuable. Additionally, another major factor that contributed to the price appreciation was expectations. Just as they influence consumer goods prices, expectations about future home prices also drive up the demand in the industry since people believe it is prudent to make a purchase now rather than wait for the prices to come down after peaking. According to the Fed, the inverse of a metric called the ‘user cost of housing’ which measures the difference between mortgage rates and housing price expectations was the highest since 1974 in 2022 – and the result on the market is clear for everyone to see.

So what are these results right now? On this front, data from Redfin provides some insights. It shows that the median home price in America peaked at a five year high in May 2022. However, from then until January 2023 it started on a downward trend that saw it drop from approximately $425,000 to $385,000 – for a substantial drop. Crucially, looking solely at median prices would suggest that perhaps home buyers are shifting their focus on lower priced homes in a high interest rate environment. As a deeper look at the data shows that home sales had peaked at a little over 600,000 in June 2022 but dropped below 300,000 in January.

On a positive note, as we’ll discuss later, this downturn appears to be reversing as the market acclimatizes itself to a high interest rate environment. This is because according to Redfin, the median sale price of a home in America right now is $400,000 as of March 2023 for a small 3.4% annual drop. In other words, you’d still be better off having bought a home instead of just sitting on cash as inflation right now is higher than 3.4% – however, if you had invested in money market funds then the return would have been higher.

Building on this, the Federal Reserve has even more data for the residential real estate market that merits a deeper look. This data outlines that in March 2023, 4.4 million homes were sold in America. Comparing this to the year ago figure reveals that this marks a painful 22% annual drop, becoming the biggest victim of a high rate environment. However, narrowing our focus down to the past four months shows that a recovery might be in play. This is because while existing home sales tanked to four million in December 2022, they jumped back to 4.5 million in February and marked only a slight drop in the following month. So, the jury’s still out on what might occur in the housing market in the future.

Taking further stock of the market, data from the National Association of Realtors (NAR) provides valuable insight into the reasons behind the drop and rise in the existing home sales shared above. By quantifying home affordability through an index, the NAR shows that the index dropped to 98.6 in March after jumping to 103.8 in February. This shows that as affordability became an issue, the number of homes sold dropped and vice versa. Further cementing this conclusion is the fact that the index was at 101.4 in December for a three month high and at the second highest level in eight months – and the result was clear as the market tanked.

Finally, to round off the current situation in the housing market, it’s important to see what the companies that make and sell homes are saying. On this front, the management of LGI Homes, Inc. (NASDAQ:LGIH) shared valuable insights during the firm’s latest earning call where they outlined:

The LGI Homes team delivered solid first quarter results and laid the groundwork for a successful year. In the second half of 2022, as rates spiked and demand slowed, our focus shifted to moving inventory and generated cash through a combination of increased advertising, incentives, price discovery, slowing starts and reducing home costs. That work is now complete. We closed 1,366 homes and generated over $487 million in revenue despite starting with limited homes in inventory and our lowest backlog in 4 years.

Company-wide, we averaged 4.7 closings per community per month, which was only slightly below our pre-pandemic first quarter average of 5.1 closings per community per month. Northern California was our top performer with an impressive 9.2 closings per community per month. Seattle was second with 8.1, followed by Dallas/Fort Worth was 6.5%, Raleigh was 6.3% in Las Vegas with 6 closings per community per month. Congratulations to the teams in these markets for an outstanding performance this quarter. In the first quarter, we pivoted from cash generation to driving new orders as demand increased and buyers responded to modest rate incentives, smaller product offerings, lower, more stable interest rates in our targeted marketing. Our targeted marketing is a point we’re spending them in.

Our marketing team continues to do an outstanding job connecting with new customers. In the first quarter, we generated over 130,000 leads. This is the most leads we’ve ever generated and is a testament to our ability to connect with interested buyers. As a result, we saw a 12% increase in net sales compared to last year and a 148% increase in net orders sequentially. Our pace of net orders in the first quarter was 7.6 homes per community per month, the highest pace we’ve seen since the first quarter of 2021. In response to the strength and consistency of these demand trends, we started construction on over 1,700 homes. We also began increasing prices in many of our communities as we now pivot to increasing gross margins throughout the rest of the year.

Keeping these comments in mind, let’s take a look at the American cities where home prices are growing.

Pixabay/ Public Domain

Our Methodology

To compile our list of the U.S. cities where home prices are going up, we used data from Standard & Poor’s S&P CoreLogic Case-Shiller Metro Area index. This index measures home prices in key American metropolitan areas and it covers housing price percentage growth or drop for twenty metropolitan areas. Out of these, the cities in which home prices are rising are listed below. By the way, some of these cities are among the 30 cities with the highest homelessness rate.

12 Cities Where Home Prices are Going Up Right Now

12. Minneapolis, Minnesota

1 Year Home Price Change: 0.54%

Minneapolis is the most populous city in Minnesota as it houses more than four hundred thousand people. It is one of the largest economic centers in the Midwestern United States.

11. Washington, D.C.

1 Year Home Price Change: 1.14%

Washington D.C. is one of the most expensive cities to live in America. Its economy is made up primarily of the government contracting sector and related industries.

10. Detroit, Michigan

1 Year Home Price Change: 1.58%

Detroit is an economic hub in its state. It is also the most populous city in Michigan, housing more than half a million people. The Detroit economy is made up of a variety of firms in the financial, services, and other industries.

9. Dallas, Texas

1 Year Home Price Change: 1.98%

Dallas is the third largest city in Texas and among the top ten most populous regions in America. It has a diversified economy full of technology, energy, and other companies.

8. Boston, Massachusetts

1 Year Home Price Change: 2.21%

Boston is the capital city of Massachusetts. It is a hub for the high technology and healthcare industries in the U.S. and houses some of America’s largest hospitals.

7. New York City, New York

1 Year Home Price Change: 3.59%

New York is the financial heart of America and the world. It is also the biggest city in the U.S. housing millions of people.

6. Chicago, Illinois

1 Year Home Price Change: 3.59%

After New York and Los Angeles, Chicago is the third largest city in America. It is also one of the biggest business regions in the U.S. but has some of the highest crime rates too.

Click to continue reading and see 5 Cities Where Home Prices are Going Up Right Now.

Suggested Articles:

Disclosure: None. 12 Cities Where Home Prices are Going Up Right Now is originally published on Insider Monkey.

AI Fire Sale: Insider Monkey’s #1 AI Stock Pick Is On A Steep Discount

Artificial intelligence is the greatest investment opportunity of our lifetime. The time to invest in groundbreaking AI is now, and this stock is a steal!

The whispers are turning into roars.

Artificial intelligence isn’t science fiction anymore.

It’s the revolution reshaping every industry on the planet.

From driverless cars to medical breakthroughs, AI is on the cusp of a global explosion, and savvy investors stand to reap the rewards.

Here’s why this is the prime moment to jump on the AI bandwagon:

Exponential Growth on the Horizon: Forget linear growth – AI is poised for a hockey stick trajectory.

Imagine every sector, from healthcare to finance, infused with superhuman intelligence.

We’re talking disease prediction, hyper-personalized marketing, and automated logistics that streamline everything.

This isn’t a maybe – it’s an inevitability.

Early investors will be the ones positioned to ride the wave of this technological tsunami.

Ground Floor Opportunity: Remember the early days of the internet?

Those who saw the potential of tech giants back then are sitting pretty today.

AI is at a similar inflection point.

We’re not talking about established players – we’re talking about nimble startups with groundbreaking ideas and the potential to become the next Google or Amazon.

This is your chance to get in before the rockets take off!

Disruption is the New Name of the Game: Let’s face it, complacency breeds stagnation.

AI is the ultimate disruptor, and it’s shaking the foundations of traditional industries.

The companies that embrace AI will thrive, while the dinosaurs clinging to outdated methods will be left in the dust.

As an investor, you want to be on the side of the winners, and AI is the winning ticket.

The Talent Pool is Overflowing: The world’s brightest minds are flocking to AI.

From computer scientists to mathematicians, the next generation of innovators is pouring its energy into this field.

This influx of talent guarantees a constant stream of groundbreaking ideas and rapid advancements.

By investing in AI, you’re essentially backing the future.

The future is powered by artificial intelligence, and the time to invest is NOW.

Don’t be a spectator in this technological revolution.

Dive into the AI gold rush and watch your portfolio soar alongside the brightest minds of our generation.

This isn’t just about making money – it’s about being part of the future.

So, buckle up and get ready for the ride of your investment life!

Act Now and Unlock a Potential 10,000% Return: This AI Stock is a Diamond in the Rough (But Our Help is Key!)

The AI revolution is upon us, and savvy investors stand to make a fortune.

But with so many choices, how do you find the hidden gem – the company poised for explosive growth?

That’s where our expertise comes in.

We’ve got the answer, but there’s a twist…

Imagine an AI company so groundbreaking, so far ahead of the curve, that even if its stock price quadrupled today, it would still be considered ridiculously cheap.

That’s the potential you’re looking at. This isn’t just about a decent return – we’re talking about a 10,000% gain over the next decade!

Our research team has identified a hidden gem – an AI company with cutting-edge technology, massive potential, and a current stock price that screams opportunity.

This company boasts the most advanced technology in the AI sector, putting them leagues ahead of competitors.

It’s like having a race car on a go-kart track.

They have a strong possibility of cornering entire markets, becoming the undisputed leader in their field.

Here’s the catch (it’s a good one): To uncover this sleeping giant, you’ll need our exclusive intel.

We want to make sure none of our valued readers miss out on this groundbreaking opportunity!

That’s why we’re slashing the price of our Premium Readership Newsletter by a whopping 70%.

For a ridiculously low price of just $29, you can unlock a year’s worth of in-depth investment research and exclusive insights – that’s less than a single restaurant meal!

Here’s why this is a deal you can’t afford to pass up:

• Access to our Detailed Report on this Game-Changing AI Stock: Our in-depth report dives deep into our #1 AI stock’s groundbreaking technology and massive growth potential.

• 11 New Issues of Our Premium Readership Newsletter: You will also receive 11 new issues and at least one new stock pick per month from our monthly newsletter’s portfolio over the next 12 months. These stocks are handpicked by our research director, Dr. Inan Dogan.

• One free upcoming issue of our 70+ page Quarterly Newsletter: A value of $149

• Bonus Reports: Premium access to members-only fund manager video interviews

• Ad-Free Browsing: Enjoy a year of investment research free from distracting banner and pop-up ads, allowing you to focus on uncovering the next big opportunity.

• 30-Day Money-Back Guarantee:  If you’re not absolutely satisfied with our service, we’ll provide a full refund within 30 days, no questions asked.

 

Space is Limited! Only 1000 spots are available for this exclusive offer. Don’t let this chance slip away – subscribe to our Premium Readership Newsletter today and unlock the potential for a life-changing investment.

Here’s what to do next:

1. Head over to our website and subscribe to our Premium Readership Newsletter for just $29.

2. Enjoy a year of ad-free browsing, exclusive access to our in-depth report on the revolutionary AI company, and the upcoming issues of our Premium Readership Newsletter over the next 12 months.

3. Sit back, relax, and know that you’re backed by our ironclad 30-day money-back guarantee.

Don’t miss out on this incredible opportunity! Subscribe now and take control of your AI investment future!


No worries about auto-renewals! Our 30-Day Money-Back Guarantee applies whether you’re joining us for the first time or renewing your subscription a year later!

A New Dawn is Coming to U.S. Stocks

I work for one of the largest independent financial publishers in the world – representing over 1 million people in 148 countries.

We’re independently funding today’s broadcast to address something on the mind of every investor in America right now…

Should I put my money in Artificial Intelligence?

Here to answer that for us… and give away his No. 1 free AI recommendation… is 50-year Wall Street titan, Marc Chaikin.

Marc’s been a trader, stockbroker, and analyst. He was the head of the options department at a major brokerage firm and is a sought-after expert for CNBC, Fox Business, Barron’s, and Yahoo! Finance…

But what Marc’s most known for is his award-winning stock-rating system. Which determines whether a stock could shoot sky-high in the next three to six months… or come crashing down.

That’s why Marc’s work appears in every Bloomberg and Reuters terminal on the planet…

And is still used by hundreds of banks, hedge funds, and brokerages to track the billions of dollars flowing in and out of stocks each day.

He’s used this system to survive nine bear markets… create three new indices for the Nasdaq… and even predict the brutal bear market of 2022, 90 days in advance.

Click to continue reading…