These cities are getting good home values lately.
So who said the property market is in shambles? Not for these five cities according to Altos Research who listed the top affordable cities in the country. Forbes Magazine reports that amidst the continuous decline in home values, some cities are managing to go against the current with Lexington, MA leading the way. The report cites this historic city to be “has seen prices increase more than anywhere else. List prices rose 36% since last year, to a median $1,197,923. But this more likely reflects a change in the type of house for sale than an increase in the price of a typical house.
“That’s because price per square foot—a measure that helps evenly compare houses against each other—has stayed flat in Lexington since this time last year. That suggests that the city’s 10% drop in inventory means not only market demand, but demand for lower-price houses. The historic Northeastern town has tourist appeal as well as a top-tier school system. Lures like these, combined with historically low interest rates, have allowed families to snatch reasonably priced homes off the market faster, while higher-price homes take longer to sell, pulling up the median price. Inventory has tightened throughout the market, not just in Lexington. In 83 of the 100 fastest-increasing markets, the number of homes for sale is down since this time last year.”
Sounds good to me. But I’d like to think that another reason why prices are sustained in Lexington is that its business environment is less affected by the recession and hence, homeowners do not have to worry a lot about job losses relative to other metropolises. One good thing is the diversity of commerce in the city helps it defy the larger effects of the prevailing economic climate. This includes life sciences, medical and professional services, tourism and defense industries.
Following Lexington in the list are the following areas with their corresponding YoY price change:
- Bay Village, OH (+32 percent)
- Sunnyvale, CA (+32 percent)
- Poway, CA (+27 percent)
- University City, MO (+26 percent)
If you’re thinking what I’m thinking, then yes, California has two areas unaffected by the statewide market slump. At first I couldn’t believe it but the report’s defense is pretty convincing: “because markets in that state were inflated earlier, many were well positioned to make a comeback even before the larger economy recovered”.
Sellers, this is a good time for you. Buyers, you may not find bargains compared to other depressed states but on the bright side, you’re sure that your house can put up much value.
Here’s a video about Lexington: