Texas and Florida are the best states for buyers to get a home at the moment, with seven of the country's top 10 cities to do so, according to a new report from real estate company Zillow. Houston, Austin and San Antonio made the list in the former, while Jacksonville, Orlando and Tampa did so for the latter.
The states' attractiveness becomes higher when considering that most of the country's 50 largest metro areas currently favor those who are selling. This is because there still is a "desperate lack of homes on the market for buyers to choose from compared to the pre-pandemic" period despite price cuts and inventory ahead, the company explained.
"So while the index is further in favor of buyers than any April since 2019, it's still in seller's territory," Zillow added. The company crafted its index based on the share of homes that go pending in three weeks or less, those with a price cut and engagement on the company's active listings in the market.
Looking at Texas and Florida, the company explained that potential buyers are seeing less competition than in the early pandemic period, as "strong construction in many of these markets has helped restore inventory levels." "Austin and San Antonio are two of just three markets with more inventory now than pre-pandemic, while Tampa, Orlando and Jacksonville have among the smallest deficits."
The larger inventory mean that three of the four "buyers markets" are in Florida. And out of the seven that are neutral, another one is in Florida while three more are in Texas. The remaining 39 are seller markets or strong seller markets, Zillow said. On the other end of the spectrum are Buffalo and coastal tech hubs like the Bay Area.
The imbalance favoring sellers is consistent with a recent analysis from real estate company Redfin, which said in late April that the cost of buying a home is the highest in at least a decade.
This is a result of the combination of higher mortgage rates, which have topped 7% for the first time for fixed 30-year home loans according to Freddie Mac, and higher home prices.
Redfin said that the median asking price for a home in the country reached a record $415,925 in the four weeks ended on April 1.
Moreover, the median home sale price also hit a record in April, at least since 2015: $383,727. The combination of sale prices and current mortgages has taken monthly payments to a record $2,843, a 13% increase from a year ago.
This has taken the average income that Americans must make in order to afford a home to at least $76,000, according to a recent CBS report, also based on figures from Redfin.
By comparison, only four years ago, people with annual earnings of $40,500 could afford a typical starter house, the online estate firm said in its report.
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