Three California housing markets cracked the top 10 hottest housing markets of December, according to a recent Realtor.com® report. Half of the nation’s 20 hottest markets had prices higher than the national median of $375,000.
However, most of these markets, with the exception of Santa Maria, CA, where the average was listed for roughly $1.4 million, were cheaper alternatives to larger, more expensive cities. With fewer white-collar professionals back in their offices full time, many are looking for reasonably priced homes that are farther out, but still within commuting distance of their offices.
“Americans, by and large, are focusing on affordability. When they’re considering buying a home, affordability is their No. 1 concern,” says George Ratiu, manager of economic research at Realtor.com. “A lot of the markets above the median list price tend to be located within commuting distance of larger, much more expensive metropolitan areas.”
The Realtor.com economic research team came up with its monthly ranking of the hottest U.S. markets for real estate by tracking the metropolitan areas where homes are selling the quickest and where the most potential buyers are clicking on property listings. The report looked at metropolitan areas, which include the main city and surrounding towns, suburbs, and smaller urban areas.
Homes that made the list typically receive 1.3 to 1.5 times the number of views per listing compared with the national rate. Properties in these markets also spent about 15 fewer days on the market.
The markets on the list also tended to have stronger job markets.
“People clearly don’t just want an inexpensive house,” says Ratiu. “They want a vibrant community with a vibrant economy along with affordable housing.
The hottest market was once again Manchester, NH, which snagged the top spot on the list eight times in 2021. Manchester, which is a city in its own right of more than 115,000 residents, is just an hour northwest of Boston. However, homes in the New Hampshire metro area were about $150,000 less than they were in the Boston metro, where the median list price was just under $700,000.
“Manchester has a trifecta of factors, which has kept it at the top,” says Ratiu. “It is very close to Boston, a major city with lots of jobs. It is located in a state with no income or sales tax at a time of high inflation. And Manchester offers what a lot of Americans are looking for in a pandemic, which is access to the outdoors and recreational activities.”
Just because homes are a bit cheaper in Manchester doesn’t mean that buyers will have an easier time winning bidding wars there: Competition is stiff. Listings racked up about 3.5 times as many unique views as they did in the rest of the country.
Homes in the metro also sold at lightning speed, selling 10 days faster than in the rest of the country at about 38 days. This was 12 days quicker than they did the same time last year. List prices also rose sharply, jumping 12.2% compared with December 2020.
“People are taking advantage of the current [remote] employment landscape and looking for their dream homes farther out,” says Ratiu.
The hot list
|Metro||Rank||Rank Change YoY||Median Listing Price|
|Fort Wayne, IN||4||-1||$232,450|
|Santa Maria, CA||7||+59||$1,397,000|
|La Crosse, WI||9||+43||$282,500|
|North Port, FL||10||+193||$507,000|
|Colorado Springs, CO||13||-11||$492,531|
|Rapid City, SD||18||-13||$379,250|