Today’s housing market is one of the most competitive in decades, according to researchers at Realtor.com, with the median U.S. list price increasing 10% over the last year to reach $275,000 in May. For-sale inventory levels dropped 11% during the period, and homes are selling five days sooner today than they were a year ago.
Locally, the hottest markets on Realtor.com’s list in May were Vallejo, CA, and its neighbor San Francisco, which retained their No. 1 and No. 2 rankings, followed by Boston, Sacramento, CA, and Kennewick-Richland, WA.
Among the movers on the list, San Jose slipped to No. 9, its lowest ranking in a while, and Boston climbed to No. 3. Kennewick, along the Oregon border in Washington state, climbed 12 spots to crack the top 5, and Midland, TX, skyrocketed from No. 32 to No. 8.
It comes as little surprise that California claimed three of the top five most active housing markets last month. Low inventory and rising prices there continue to dominate headlines. In fact, estimates by the California Department of Housing and Community Development say the state is building 100,000 fewer homes annually than are needed to meet demand.
Boston’s tight inventory caused a softening of the home-sales market there in April, reported the Greater Boston Association of Realtors, with single-family home sales dropping 9.4% year-over-year in April. Boston is the eighth-toughest market for first-time buyers, according to a Zillow ranking, with a median home value of $419,900, the sixth-highest in the country, and a tight inventory of just 9,903 available properties.
The Tri-Cities area in Washington state, which includes Kennewick-Richland, has the state’s fastest-growing job market, with a 3.6% annual growth rate in 2016, led by food manufacturing and the region’s robust agricultural economy. At the moment, however, the region’s housing supply isn’t keeping up with demand, KNDU reported.
Despite the oil bust in West Texas, growth in one of the region’s biggest cities isn’t stopping. In Midland, TX, the promise of more energy production lingers and with it steady population growth as energy companies open offices and local retail development picks up. The city is one of the most expensive in the state, though its median list prices have come down from $285,000 in July 2014 to $255,000 in April 2017.