American home shoppers have plenty to fear this Halloween as the housing crunch continues. But where buyers live plays a role in how stressful their experience is.
Though markets are tough across the nation, California is home to the scariest housing markets in the U.S., according to a new analysis by Point2.
Of the 200 largest American metros, California markets bode worst for homebuyers based on price changes and for-sale inventory.
Nine of the ten worst markets are in California, and they aren’t stereotypically wealthy West Coast leaders like San Francisco and Los Angeles. Instead, these are emerging hubs like Escondido and Sunnyvale, which were once more affordable than their famous counterparts.
Finding affordable housing in California has long been a concern for residents of the country’s largest state. But home shoppers in historically affordable metros are now facing their greatest fears: prices mimicking coastal hotspots.
Throughout the country, prices are up the most in markets once known for their affordability.
Since 2022, Louisville, KY, Tallahassee, FL, and Kansas City, KS home prices are up more than 20%.
What’s scaring homebuyers the most isn’t just prices, however. Stock shortages are keeping competition high and leading to available homes flying off the market. In Grand Rapids, MI, and Lakewood, CO, homes consistently sell in less than a week after listing.
All of this chaos has created a gloomy atmosphere among consumers. Both buyers and potential sellers are terrified of the worsening market and its impact on their future finances. Nearly 70% of Americans believe the country is headed for a housing crash. One in five Millennials think they’ll never be able to afford a home.
Analysts are quick to dispel visions of a 2008-style bubble burst, however. Most agree that as long as there are more buyers than sellers, home prices will stay elevated for the foreseeable future.
“We simply don’t have enough inventory,” Lawrence Yun, NAR’s chief economist, said of the possibility. “Will some markets see a price decline? Yes. [But] with the supply not being there, the repeat of a 30 percent price decline is highly, highly unlikely.”
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