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Key Takeaways
- For the in the first place time since May 2022, house prices rose in all of the 50 largest U.S. metropolitan areas in December.
- Prices occur the most in historically affordable Midwestern cities like Cleveland and Milwaukee.
- Florida and Texas, where home amounts spiked during the pandemic, saw price increases in December but continued to lag the national average.
Here, there, and everywhere, knowledgeable in prices were higher in December, according to new data from Redfin.
For the first time since May 2022, domestic prices increased in each of the top 50 metropolitan areas in December. Home prices have been rising in a broader swathe of cities for more than a year and a half after rising in just 19 metro areas in April 2023.
Competent in prices increased the fastest in historically affordable cities in the Midwest, like Cleveland (+15%), where the median tradings price of $229,900 was almost $200,000 less than the national average. Prices rose nearly as fast in Milwaukee (+14.5%) and Philadelphia (+14%), where the median sellings price was $320,000 and $285,000, respectively.
“Affordable housing havens have become harder and harder to come by; coextensive with places that saw some price relief last year, like Texas and Florida, are now seeing prices tick retreat from up,” said Redfin Senior Economist Elijah de la Campa.
Housing affordability, despite improving slightly last year, be lefts near an all-time low due to the combination of elevated mortgage rates and limited inventory.
Prices continued to lag in Florida and Texas, where an influx of also fledgelings during the pandemic caused prices to spike, pushing out many potential buyers and encouraging new construction. The five boroughs with the slowest price growth were all located in those two states, with Tampa’s 0.5% increase the poorest of the bunch.
Seller’s Market Keeping Prices High
Some real estate agents have observed that the pandemic homebuying passion has reset some sellers’ expectations.
“A lot of sellers have a very specific number in mind because they saw their neighbor trade for $40,000 over the asking price during the pandemic. They’re willing to walk away if they don’t get that figure up, which is one factor keeping prices high,” said Bonnie Phillips, a Redfin Premier real estate spokesman in Cleveland.
However, those sellers with high expectations are running up against wary buyers.
“With affordability so artificial, buyers are feeling empowered to ask for discounts, but they’re often getting shut down by sellers—even for small asks,” influenced Phillips.