The 10 best cities to buy a home in 2023 are all in the South
Even with rising homeownership costs squeezing out buyers, some real estate markets will remain hot in 2023, mostly due to their relative affordability compared with the rest of the U.S., a new forecast finds.
The top places have something else in common, too: They're all located in the South.
Based on a variety of factors, including home affordability, job growth, migration gains and housing supply, the National Association of Realtors (NAR) analyzed 179 markets to determine which will offer the most value to buyers. The data looks back one year from October 2022 and reflects expected demand from buyers in 2023.
The median price of homes in some of these markets isn't cheaper than the national median of $398,500. However, these cities scored high on other metrics such as job growth or housing supply.
Here are the 10 best places to buy a home in 2023, according to NAR:
1. Atlanta-Sandy Springs-Marietta, Georgia
Median home price: $371,200
With major tech companies such as Apple, Microsoft and Visa opening Atlanta offices in recent years, the city has a robust job market.
The Atlanta metro area remains relatively affordable compared with other regions in the country. Over 20% of renters can afford to buy a median-priced home in the area, based on a calculation that includes a 10% down payment. The national average is 15.1%.
2. Raleigh, North Carolina
Median home price: $460,500
A fast-growing tech hub with low unemployment, Raleigh has seen home prices increase by almost 30% since 2020. With a median home price near $500,000, it is the most expensive of the top 10 markets for 2023.
However, "local home listing prices are coming down from this summer's peak, home inventory has increased 188% in the last 12 months and unemployment in Raleigh is lower than it was pre-pandemic," said Jay Nelson, communications director at the Raleigh Regional Association of Realtors, in a recent interview with The News & Observer.
3. Dallas-Fort Worth-Arlington, Texas
Median home price: $390,100
Dallas-Fort Worth is another emerging tech hub in the U.S., with job growth nearly twice as high as the national average, which was 3.4% for the year looking back from October 2022.
While the supply of homes is less than the national average, inventory increased in 2022, with the number of active listings tripling the national average, according to NAR's data.
4. Fayetteville-Springdale-Rogers, Arkansas-Missouri
Median home price: $328,400
Home to three Fortune 500 companies — Walmart, Tyson Foods and J.B. Hunt Transport Services — this metro area is second among NAR's top 10 rankings in terms of housing affordability.
It's a growing market, too, with annual population growth of 2% — well above the national average of 0.01%.
Homes are also cheap, with prices second only to Huntsville, Alabama, among this list. The share of renters that can afford the typical home is nearly double the national average.
5. Greenville-Anderson-Mauldin, South Carolina
Median home price: $335,400
While housing affordability is on par with the national average, job growth in this area is strong, especially for high-paying information technology jobs like computer programming or web development.
There are more houses to choose from, too, as the supply of homes in 2022 was more than twice the national average.
6. Charleston-North Charleston, South Carolina
Median home price: $416,800
Of the top 10 rankings, the Charleston area is second only to Raleigh for the highest median price for homes. It's also below the national average when it comes to affordability.
However, this fast-growing market has strong migration gains and job growth that is nearly twice the national average.
7. Huntsville, Alabama
Median home price: $327,500
Alabama's most populous city is the most affordable area for homes amongst this list. Just under 30% of renters can afford a typical home with a 10% down payment, which is almost twice the national average.
Growing job opportunities and low cost of living will continue to attract even more movers in 2023, according to NAR.
8. Jacksonville, Florida
Median home price: $398,000
As with many cities in Florida, Jacksonville became a migration hotspot during the pandemic, with home prices soaring by almost 58% since the beginning of 2020.
Jacksonville's house prices are nearly on par with the median price in the U.S., but it's more affordable than other areas statewide, according to NAR.
The qualifying income to purchase a median-priced home with a 10% down payment is about $98,000. That's less than most large metro areas across the state, including Miami, where the qualifying income with a 10% down payment is $140,000.
Jacksonville also has a strong job market and a good supply of homes compared with the rest of the country.
9. San Antonio-New Braunfels, Texas
Median home price: $342,700
San Antonio became a migration hotspot during the pandemic, especially from California, where home prices and the cost of living tend to be more expensive.
The city has become a destination within the state of Texas, too. Many potential homebuyers have migrated to San Antonio from nearby Austin, largely due to cheaper home prices.
In San Antonio, residents earning $85,000 qualify for a median priced home, including a 10% down payment, much less than $130,000 required in Austin. Job growth is also stronger than the national average.
10. Knoxville, Tennessee
Median home price: $331,100
In 2022, Knoxville's population grew by its largest total since 2007, driven largely by its relative affordability compared with the rest of the country as a whole. A robust job market and supply of homes that rebounded in 2022 is expected to keep this market in high demand in 2023.
While home prices in Knoxville skyrocketed during the pandemic, nearly a quarter of renters can still afford to buy a median-priced home with a 10% down payment, which is about 10% more than the national average.
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