The fact that the pandemic has turned many traditional concepts of real estate upside down has by now become a worn-out cliché — some of the fastest price growth has been taking place in suburbs and smaller cities while many wealthy metropolises have started to see cracks amid years of increases.
The National Association of Realtors (NAR) recently reported that, at $363,000, the median price of a home sold in the U.S. this February breaks an 11-year streak of upward growth.
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Of course, there is significant variation from state to state and city to city. According to the latest housing index from Black Knight first reported by the Wall Street Journal, homes prices rose by a respective 12% and 9.3% in Florida's Miami and Orlando but fell by more than 10% in California's San Jose and San Francisco between January 2022 and 2023.
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In general, the biggest drops have been taking place in the western part of the country. While 12 of the major cities west of Texas saw real estate drops in the last year, 37 cities east of Colorado continued to see increases.
"The uptick in interest rates does not seem to have had any effect on our market," Lisa Barall-Matt, a Berkshire Hathaway HomeServices New England Properties agent in West Hartford, Connecticut, told the WSJ.
The industrial city home to 120,000 people and many aerospace and manufacturing companies saw its average home grow in price by more than 8% between 2022 and 2023.
When looked at over the course of several years, the biggest price hike occurred in Tampa. Between 2020 and 2023, home prices in the West Florida city rose in price by 59%. A number of Florida cities also made the top list — prices rose by 53% in Miami, 50% in Jacksonville and 48% in Orlando.
This reflects a movement that began when, at the height of the pandemic, many found themselves able to work remotely for the first time and sought to move to Florida from colder and more expensive cities. Real estate costs in the state soared and, in most coastal cities, are still riding that wave even as prices in many other places start to trend downward.
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"We still have a lot of buyers who are here that we still can't find homes for," Judy Zeder, a real estate agent with the Jills Zeder Group at Coldwell Banker Realty in Miami, told the WSJ.
Non-Florida cities where prices rose the most in the last three years include Austin (50%), Charlotte (49%) and Atlanta (49%).
But in the country overall, the picture is quite different. NAR data found that, between January 2022 and 2023, the number of homes on the market rose 15.3% to 980,000 as many people feel pushed out of buying by high mortgage rates and prices.
But the situation remains in constant push-and-pull between sellers and buyers as both investors and primary residence seekers wait for the slightest drop to buy.
"Conscious of changing mortgage rates, home buyers are taking advantage of any rate declines," NAR Chief Economist Lawrence Yun said in a press statement. "Moreover, we're seeing stronger sales gains in areas where home prices are decreasing and the local economies are adding jobs."
