The housing market “hidden gems” which emerged in the South during the pandemic as homebuyers went in search of more affordable areas, are continuing to retain homes values even as other parts of the country are experiencing declines.
That’s largely due to strong fundamentals such as wage and job growth, still-relative affordability, and population growth, according to a new study.
Bankrate analyzed 212 metro areas, examining appreciation of home values, employment levels, population growth and housing availability and competitiveness to create the Housing Heat Index.
“The momentum in the housing market has shifted to the Sun Belt, and especially to Georgia, the Carolinas and Florida,” says Bankrate analyst Jeff Ostrowski. “This region’s comparatively affordable prices are attractive to buyers moving in from more expensive parts of the country – but the still-strong values create challenges for first-time buyers.”
Homebuyer sentiment:Buying a house? Not now, many Americans say as frustration over economic conditions mount
Housing market:Is it better to rent or buy? The best house prices vary city to city
These metros remain a relatively affordable place to live and work, attracting people and businesses and are considered ‘up and coming’ in comparison to the larger metro areas that have become unaffordable.
Topping the index is Gainesville, Georgia, a metro area of 207,000 people located about 50 miles northeast of Atlanta. The area experienced annual home value appreciation of 21%, according to the Federal Housing Finance Agency.
Even after the surge in prices, the median price of homes sold in Gainesville in April was $375,000, according to Realtor.com. That’s a bit below the national median of $388,800.
In another strong point for the Gainesville metro area, its unemployment rate as of February was just 2.6%, according to the study.
“Take lower-cost and lower-tax areas that continue to add population, add in limited inventory of homes for sale, and you have the recipe for housing market strength,” says Greg McBride, chief financial analyst for Bankrate.
In fact, the ten metros with the hottest housing markets all lie in the Southeastern U.S., with Florida claiming four.
Top 5 hottest housing markets
- Gainesville, Georgia
2. Knoxville, Tennessee
3. Cape Coral-Fort Myers, Florida
4. North Port-Sarasota-Bradenton, Florida
5. Charlotte, North Carolina
