Some Metro Areas Are Potentially On Track To Go For the Gusto In Sales And Prices In 2023

Another year, another brand new real estate market? Perhaps in some areas, according to Realtor.com’s housing forecast and economic overview.

Dozens of markets across the country are poised to see a significant surge of potential homebuyers in 2023, according to the new report, with some metro areas expected to grow — both in home sales and prices — during what’s expected to be an otherwise challenging time for the housing market.

Connecticut’s Hartford-West Hartford-East Hartford metro area, for one, is expected to see sales growth to jump by 6.5% and produce a price growth increase of 8.5%, edging out Texas’ El Paso metro area and Kentucky’s Louisville metro area (14.3%), which ranked second and third, respectively, in the 2023 housing forecast.

A ranking of the top 10 housing markets of 2023, according to the report, also includes Louisville/Jefferson County, Kentucky/Indiana (13.6%), Worcester, Massachusetts-Connecticut (13.1%), Buffalo-Cheektowaga-Niagara Falls, New York (12.3%), Augusta-Richmond County, Georgia/South Carolina (11.9%), Grand Rapids-Kentwood, Michigan (11.6%), Columbia, S.C. (11.3%), Chattanooga, Tennessee-Georgia (11.1%), and Toledo, Ohio (10.9%).

Those numbers may not seem notable, but when compared to the average combined growth for the entire U.S.(as projected by Realtor.com, -8.7%), it becomes evident. The reason for the growth in those particular metro areas is that they have further to go — due to the early stages of the COVID-19 pandemic, which saw mortgage rates drop to record lows. However, in 2022, the Fed increased the policy interest rate, making borrowing more expensive. Many homebuyers then went on the hunt for affordable metros, straying further from large, urban centers to mid-size cities with strong economies.

If you study these top 10 cities from the Realtor housing report, they appear to fit this description, offering a larger share of affordable homes for a median income. Another interesting development? Those looking for a new home aren’t set on staying where they are. The study found that over 60% of homebuyers browsing Realtor.com are looking at properties away from their current cities — an increase from the less-than-50% of site users who were looking to move away from their residences pre-pandemic. It seems that transiency is no longer a dirty word when it comes to finding a place called home when the price is right. Boomers and retirees looking for a lower cost of living, young families seeking larger homes, and people simply looking for a higher quality of life are all thrown into this mix.

Realtor, TBWS