A stubborn lack of inventory and high mortgage rates kept many prospective homebuyers at bay for most of 2023. However, experts believe that 2024 could be the year that prospective homebuyers finally catch a break. With mortgage rates steadily dropping, it's a good time to explore the best real estate markets for the coming year.
Southern California Steals the Show
Five of this year's top 10 metro areas are in Southern California, which is projected to perform better than the state as a whole. These markets are expected to see an estimated average sales growth of 13.1% in 2024, compared to a sales decline of 4.1% for other California areas in the top 100, according to an analysis by Realtor.com. Additionally, these markets offer relative affordability compared to the national median home price, especially in the Midwest and Northeast.
"Now that we're seeing the beginning of an affordability turnaround, home buyers are still looking for markets where they can capitalize on lower prices," says Realtor.com Chief Economist Danielle Hale. "Even in some of the more expensive markets, we'll see double-digit sales growth as sales start to rebound from their historic lows, helped by mortgage rates which are expected to finally relent."
Midwestern and Northeastern Areas: Affordability and Quality of Life
The top markets in Midwestern and Northeastern states are more affordable, with median listing prices lower than the national average. In these areas, a significant percentage of homeowners live in homes without a mortgage, which insulates them from the impact of higher interest rates. Additionally, their local economies are fueled by education, health care, and manufacturing, which are projected to have strong job growth. These areas also boast a high quality of life, with recreation, culture, and education that appeal to homeowners.
The California Dichotomy
Although several California metros have made the top 10 list of housing markets, none are in the Bay Area or among Northern Californian metros. The top five Californian metros are Oxnard, San Diego, Riverside, Bakersfield, and Los Angeles. These areas are expected to have sales growth of 13%, on average, in 2024, compared to an average decline of 4% for other Californian metros in the largest 100 list. However, despite improvements over depressed 2023 numbers, these top California metros are still predicted to have historically low sales levels, mirroring national figures.
The Top 10 Real Estate Markets for 2024:
- Toledo, Ohio
- November 2023 median home price: $200,000
- Forecasted 2024 home sales change: +14%
- Forecasted 2024 home price change: +8.3%
- Forecasted 2024 combined sales and price change: +22.3%
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Oxnard, California
- November 2023 median home price: $1,037,000
- Forecasted 2024 home sales change: +18.0%
- Forecasted 2024 home price change: +3.3%
- Forecasted 2024 combined sales and price change: +21.3%
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Rochester, New York
- November 2023 median home price: $239,000
- Forecasted 2024 home sales change: +6.2%
- Forecasted 2024 home price change: +10.4%
- Forecasted 2024 combined sales and price change: +16.6%
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San Diego
- November 2023 median home price: $995,000
- Forecasted 2024 home sales change: +11.0%
- Forecasted 2024 home price change: +5.4%
- Forecasted 2024 combined sales and price change: +16.3%
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Riverside, California
- November 2023 median home price: $585,000
- Forecasted 2024 home sales change: +13.8%
- Forecasted 2024 home price change: +2.0%
- Forecasted 2024 combined sales and price change: +15.8%
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Bakersfield, California
- November 2023 median home price: $385,000
- Forecasted 2024 home sales change: +13.4%
- Forecasted 2024 home price change: +2.3%
- Forecasted 2024 combined sales and price change: +15.7%
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Springfield, Massachusetts
- November 2023 median home price: $350,000
- Forecasted 2024 home sales change: +10.5%
- Forecasted 2024 home price change: +4.2%
- Forecasted 2024 combined sales and price change: +14.7%
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Worcester, Massachusetts
- November 2023 median home price: $475,000
- Forecasted 2024 home sales change: +9.1%
- Forecasted 2024 home price change: +4.8%
- Forecasted 2024 combined sales and price change: +13.9%
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Grand Rapids, Michigan
- November 2023 median home price: $390,000
- Forecasted 2024 home sales change: +6.1%
- Forecasted 2024 home price change: +7.2%
- Forecasted 2024 combined sales and price change: +13.3%
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Los Angeles
- November 2023 median home price: $1,150,000
- Forecasted 2024 home sales change: +9.2%
- Forecasted 2024 home price change: +3.5%
- Forecasted 2024 combined sales and price change: +12.7%
Now that you have a glimpse into the best real estate markets for 2024, it's time to consider your options. Whether you're looking for affordability, sales growth, or a high quality of life, there's a market out there that suits your needs. Stay informed and make the most of the opportunities that come your way!
Swapna Venugopal Ramaswamy is the housing and economy reporter for USA TODAY. Follow her on Twitter @SwapnaVenugopal