Affordability is identified by Zillow as the most powerful force driving real estate development this year, propelling low-cost markets to the forefront of rankings. Buffalo's typical home price is relatively low, standing at only $248,445, well below the national average.
Anushna Prakash, a data scientist at Zillow's Economic Research Department, states that in cities where housing prices are affordable and job growth is robust, the housing market is healthiest. This provides real opportunities for young individuals with aspirations of homeownership to genuinely enter the market and start accumulating assets.
She cautiously optimizes that the real estate market in 2024 will stabilize, avoiding the massive price surges seen in the early days of the pandemic or the rapid increase in mortgage rates in recent years.
For every new residential construction in Buffalo, the city generates the most new job positions, indicating an increase in housing demand in 2024. This is because new job opportunities typically mean new residents moving to the area.
In addition to Buffalo, Cincinnati, Ohio, and Columbus also rank in the top three of the hottest housing markets for 2024. The average home prices in Cincinnati and Columbus are $270,826 and $301,138, respectively. Both cities exhibit the fastest expected growth in owner-occupied families, indicating population growth and settlement of families in these cities.
According to Zillow's data, the property inventory turnover in Columbus and Cincinnati is also very fast, with properties typically staying on the market for only 11 days, almost half of the national average.
Apart from these cities, the top ten hottest real estate markets for 2024 also include Indianapolis in Indiana, Providence in Rhode Island, Atlanta in Georgia, Charlotte in North Carolina, Cleveland in Ohio, and Orlando and Tampa in Florida.
Zillow predicts that while affordability will improve, it will still be the biggest driver of the real estate market in 2024. The competition in the affordable housing market around the Great Lakes and the Midwest is already intense, meaning sellers often sign contracts with buyers much faster than the national average of 21 days.
However, the housing costs for buyers and renters in 2023 reached historic highs, effectively putting a freeze on the homeownership plans of millions of Americans. While mortgage rates have declined somewhat, experts predict that the shortage of homes for sale will persist into this year, further intensifying market competition.
