With rates rising and home price appreciation still high, Americans are looking for cheap places to buy homes. September’s hottest housing markets are known for their affordability.
Rochester, NY, and Manchester, NH, tied for the country’s hottest market, according to new data from Realtor.com.
Manchester has been popular for over a year, partly because New Hampshire is known for low taxes and affordable property.
Rochester may not benefit from incredibly low taxes, but the cost of housing speaks for itself: the median list price is $223,000, far less than the national average.
“They’re equally hot, but for different reasons. Manchester properties see higher demand, but homes in Rochester spend five days less on the market,” Hannah Jones, an economic data analyst at Realtor.com, said.
They top the list of smaller, less expensive cities that are growing in popularity with homebuyers. In almost 75% of the top 20 cities, home prices are lower than the national median of $427,000.
Rounding out the top five are Fort Wayne, IN, La Crosse, WI, and Columbus, OH.
No cities in the west, where demand soared during the Great Migration, made the list. This region saw serious price growth since the pandemic began. Money-conscious buyers are staying away because of those sky-high price tags.
In California, for example, five metros were on the hottest markets list just in January, but they were all dethroned by April. Now the Golden State has one of the highest concentrations of at-risk markets should a recession erupt.
A recession could put California and other precarious markets in a tough spot.
Fannie Mae’s Economic & Strategic Research Group has predicted a recession in 2023 and even warned it could be worse than expected.
Leaders there say there is an increasing chance that the pressures of a high-rate environment could “buckle” a weak point in the worldwide financial system.
The group cited the Mexican Peso Crisis and the Asian Financial Crisis at periods when dollar appreciation coincided with international financial decline.
“Given the speed at which interest rates have risen, we believe there is a growing risk of such an event occurring over the coming quarters, which could lead to a deeper or more prolonged contraction than our base forecast expects,” the group wrote.
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