Each month, Home Value Forecast uses a number of leading real estate market-based indicators to monitor single-family home market activity in the nation’s top 200+ metropolitan areas (CBSAs) and report on the Top 10.
THE TOP 10
The Home Value Forecast Top 10 Hottest Housing Markets ranking system is purely objective and is based on directional trends over the past eight quarters. It’s not a listing of what markets are most expensive or most in need of inventory; it ranks market momentum at a specific point in time.
This month’s Top 10 has six metros from Washington state, three from California and one from Colorado:
Of the 229 metros we track:
- 80 had the maximum score in our market rating. For comparison, only two metros had the maximum score in May 2019.
- 84 had less than two months of inventory compared to one in 2019.
- 86 had Sales to List Price ratios over 100% (meaning on average homes are selling for over asking). In May 2019 there were only three, all around San Francisco.
- 80 have Days on Market averages under one month compared to two metros in 2019.
This competition has made it difficult for first-time homebuyers to enter the market, something that Presiden Biden discussed on the campaign trail. Programs like the “First-Time Homebuyer Act” are making their way through Congress that would provide a tax credit for first-time homebuyers (in this case up to 10% of the purchase price up to $15,000).
With homes routinely selling for thousands over asking, $15k might not be enough to move the needle.
About Stewart Valuation’s Monthly Market Report
The Home Value Forecast uses a ranking system that is purely objective and is based on directional trends of nine market indicators. Each indicator is given a score based on whether the trend is positive, negative or neutral for that series. For example, a declining trend in active listings would be positive, as will be an increasing trend in average price. A composite score for each CBSA is calculated by summing the directional scores of each of its indicators. From the universe of the top 200 CBSAs, each month we highlight topics and trends in the real estate market.
