In this article, we will be analyzing the housing market in the US while covering the 20 large US cities with the fewest homes for sale. If you wish to skip our detailed analysis, you can move directly to the 5 Large US Cities with the Fewest Homes for Sale.
The US Housing Market: An Analysis
The US housing market experienced a persistent crisis during 2023. While the market was short of houses, demand remained unfulfilled. Rising mortgage rates limited options for those Americans who were interested in buying a house. Simultaneously, existing homeowners felt reluctant to sell their houses since they had to pay a higher mortgage on a new home.
On January 11, Forbes reported that the housing market is expected to normalize in 2024. One sign supporting this prediction is the stabilization of mortgage rates. It has also been forecasted that the Federal Reserve might not engage in further rate hiking against inflation. The new single-family building permits also went up in November 2023. However, problems related to high home prices will continue due to a limited supply of houses. Cities where you can buy a home for under 300k have been previously covered. An increase in the housing stock combined with declining interest rates has the potential to bring the industry back to normal.
The US housing industry has depicted other bright prospects as well. On January 17, CNBC reported that homebuilder sentiment climbed up in January and reached its highest since September 2023. This positive development has been a consequence of the declining mortgage rates. These rates dropped from almost 8% in mid-October to the range of 6% in December. Builders believe that lower mortgage rates have improved affordability by convincing those buyers who had given up on buying a house, to return to the market. You can also take a look at cities where home prices are falling. Builder confidence rose the most in the Northeast of the US. South and West also saw slight increases. At the same time, homebuilders remain concerned with the building material cost and availability.
Home Builders Penetrating the US
Amidst current housing market dynamics, American home builders continue to fulfill the diverse housing needs of the population. Some of the major house-building companies include Lennar Corporation (NYSE:LEN), LGI Homes, Inc. (NASDAQ:LGIH), and KB Home (NYSE:KBH). Let’s take a look at what these firms have been up to.
Lennar Corporation (NYSE:LEN) is an American home construction company that constructs affordable, move-up, and active adult homes primarily under the Lennar brand name. It also engages in the development of high-quality multifamily rental properties. On January 9, Lennar Corporation (NYSE:LEN) reported that it will be introducing its first community in Smithfield, North Carolina. This community is situated in the suburbs of Raleigh and is expected to open in early 2024. Residents can easily commute to downtown Raleigh while staying in these affordable homes. A walking trail, a playground area, and a dog park can also be accessed. The prices of these new homes start in the high $200,000s.
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, 2023, LGI Homes, Inc. (NASDAQ:LGIH) reported the launch of two communities in Houston. The first community, Emberly, offers a short trip to Houston’s employers. Amenities such as a splash pad, pickleball courts, a sand volleyball court, and a dog park are available. The prices of these homes start in the $290,000s. The other community, Wayside Village, is based in northeast Houston. Downtown Houston and George Bush Intercontinental Airport can be easily accessed. Prices for homes in Wayside Village start in the $220,000s.
KB Home (NYSE:KBH) is one of the largest homebuilders in the United States. The firm builds quality homes that are customized as per the buyer’s preference and available budget. On January 12, KB Home (NYSE:KBH) reported the opening of its new community in Lancaster, California. Those who opt to live in this convenient location will be able to access outdoor options including Saddleback Butte State Park, Apollo Community Regional Park, and Rancho Vista Golf Club. Shopping, dining, and entertainment places are also located nearby. The model homes are available for walk-in visits as well as in-person tours. Their prices start from the low $500,000s.
You can also view some of the other largest homebuilders in the US. Now that we have navigated through the housing market in the United States, let’s move to the 20 large US cities with the fewest homes for sale.
20 Large US Cities with the Fewest Homes for Sale
Our Methodology:
In order to compile a list of the 20 large US cities with the fewest homes for sale, we acquired data from the monthly housing market trends report from Realtor.com. This report shows real estate data on the 50 largest metros in the United States. The most recent data was available as of December 2023. We have used the year-over-year change in the active listings as a metric since it better depicts the cities in which the housing inventory is running short. We have not used the number of listed houses as the year-over-year change in active listings is a more uniform metric. It helps analyze what the active listings for every city have ended up as, by the end of 2023. The negative percentages depict a decline in the housing inventory. Hence, the figures are negative for all the cities included in the list.
Finally, we ranked the largest metros in descending order of their year-over-year change in active listings.
20 Large US Cities with the Fewest Homes for Sale
20. Baltimore, Maryland
Year-Over-Year Change In Active Listings: -4.80%
In Baltimore, the active listings count went down by 4.80% year-over-year, in December 2023. Hence, Baltimore ranks as one of the 20 large US cities with the fewest homes for sale.
19. Rochester, New York
Year-Over-Year Change In Active Listings: -4.90%
Rochester is another US city with fewer homes for sale. The city saw a 4.90% year-over-year decline in its inventory of homes actively for sale in December 2023.
18. Philadelphia, Pennsylvania
Year-Over-Year Change In Active Listings: -7.60%
As recorded in December 2023, the actively listed homes reduced by 7.60% year-over-year thereby ranking the city among 20 large US cities with the fewest homes for sale.
17. Charlotte, North Carolina
Year-Over-Year Change In Active Listings: -7.60%
The 20 large US cities with the least number of homes for sale include Charlotte as well. The year-over-year decrease in the active listings in the city was recorded at 7.60% in December 2023.
16. Boston, Massachusetts
Year-Over-Year Change In Active Listings: -7.80%
Realtor reported that the active listings of houses in Boston went down by 7.80% year-over-year, in December 2023. Hence, Boston is another city with fewer houses available for sale.
15. Seattle, Washington
Year-Over-Year Change In Active Listings: -8.40%
In December 2023, the year-over-year drop in Seattle’s active listings was 8.40%. Hence, Seattle makes it to the other large US cities with the least homes for sale.
14. San Jose, California
Year-Over-Year Change In Active Listings: -12.90%
San Jose ranks among other US cities with a shortage of houses for sale. The year-over-year change in the city’s active listings was -12.90% which represents a decline.
13. New York City, New York
Year-Over-Year Change In Active Listings: -14.20%
New York City witnessed its active listings drop by 14.20% year-over-year, as recorded in December 2023. Thus, the city ranks as one of the large US cities with the fewest homes for sale.
12. Hartford, Connecticut
Year-Over-Year Change In Active Listings: -14.70%
Harford faces a shortage of homes for sale as well. The active listings in the city declined by 14.70% from December 2022 to December 2023.
11. Washington, DC
Year-Over-Year Change In Active Listings: -15.00%
Washington, DC ranks as one of the large US cities with the fewest houses available to be sold. As reported in December 2023, the year-over-year active listing count went down by 15.00%.
10. Detroit, Michigan
Year-Over-Year Change In Active Listings: -15.20%
Detroit is a Michigan-based city that has a low housing inventory. The year-over-year active listings in the city decreased by 15.20% as recorded in December 2023.
9. San Francisco, California
Year-Over-Year Change In Active Listings: -15.30%
The inventory of homes actively for sale reduced by 15.30% year-over-year, in December 2023. This ranks San Francisco as one of the US cities with the least homes for sale.
8. Riverside, California
Year-Over-Year Change In Active Listings: -17.00%
Riverside is another California-based city that has experienced a lower inventory of houses. The year-over-year active listings in the city reduced by 17.00% as reported in December 2023.
7. San Diego, California
Year-Over-Year Change In Active Listings: -17.10%
San Diego is a city in California that has fewer homes available for sale. The active home listings went down by 17.10% from December 2022 to December 2023.
6. Raleigh, North Carolina
Year-Over-Year Change In Active Listings: -17.70%
With a 17.70% year-over-year decline in the active listings count as recorded in December 2023, Raleigh becomes one of the 20 large US cities with the fewest homes for sale.
Click to continue reading and see 5 Large US Cities with the Fewest Homes for Sale.
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Disclosure: None. 20 Large US Cities with the Fewest Homes for Sale is originally published on Insider Monkey.