It may be one of the snowiest cities in America, but Buffalo, N.Y. will be the hottest housing market this year, according to a new report from Zillow.
The real-estate company analyzed the top 50 metro areas in the U.S., and looked at a number of factors to determine the “hottest” market.
That includes expected home value appreciation between December 2023 through November 2024, the availability of jobs, the speed at which homes are selling, and other factors.
Buffalo rose to the top of the list based on how relatively cheap homes are there and the city’s strong job prospects. The typical home in Buffalo is currently valued at $248,445, according to Zillow’s estimates, while the national average is $347,415. If a buyer puts 5% down on a Buffalo home, they would pay $1,792 a month for their mortgage.
One of the key measures that Zillow used to measure expected demand for housing in Buffalo was the number of new jobs being created in the area relative to the number of new homes being built.
Buffalo has the highest number of jobs per new housing unit among all 50 of the cities Zillow measured, the company noted. With more jobs, competition for housing is expected to heat up and drive home prices upwards, Zillow said, unless enough new homes are built to meet that demand.
Buffalo is also known for its intense winters. Over the 2022-2023 period, Buffalo received 133.6 inches of snow, according to the National Weather Service.
“Although our temperatures are cold, our market is not,” Vienna Laurendi, president of the Buffalo Niagara Association of Realtors and an associate real-estate broker with Howard Hanna Real Estate Services, told MarketWatch.
Buffalo was also recently designated as a federal technology hub, alongside Rochester and Syracuse, and is slated to receive billions of dollars in federal funding. The money will be used to build up the region into a semiconductor manufacturing hub in the next year.
The ex-Democratic Governor of New York Andrew Cuomo also launched a multi-billion dollar effort called the “Buffalo Billion” to revitalize its economy. The city is also a college town, boasting names such as SUNY Buffalo State University and the University of Buffalo. It’s also home to the Buffalo AKG Art Museum, and several Buffalo Bills players, including Josh Allen and Dion Dawkins.
“We have a lot of energy in both the city of Buffalo and the city of Niagara Falls,” Laurendi, a Buffalo native, said.
Laurendi noted that Buffalo also has a large medical campus, which not only brings in business from the medical community, but also the supporting organizations that they require.
“We are the biggest little city in the United States,” she said.
Laurendi also noted that there is significant opportunity for more new homes to be built in the city.
“We have an awful lot of under-utilized land” and “older infrastructure and older buildings that are just begging for revitalization and that is what our developers today are looking at,” she told MarketWatch. Some of that work also involves looking at old factories and buildings that are no longer in use, Laurendi added, “but have significant fantastic character and can be revitalized into something fabulous.”
Other ‘hot’ housing markets of 2024
Midwestern cities scored second, third, and fourth place on Zillow’s list of hottest markets, also because of how much more affordable homes are in those cities. They include Cincinnati, Columbus, both in Ohio, and Indianapolis, Ind.
“Buyers are definitely coming back now that the holidays are over,” Laurendi said, particularly as mortgage rates have fallen below 7%.
Similar to Buffalo, home prices in Cincinnati and Columbus are lower than the national average — around or below $300,000 in both Ohio markets, and the mortgage payment for a buyer putting 5% down would be less than $2,200 a month.
“Inventory is moving extremely quickly in Cincinnati, and Columbus is home to the fastest expected rise in owner-occupied households, an indication of family formation and population growth,” Zillow said.
Cheaper markets give young people a ‘real shot at buying’
Midwestern cities have dominated real-estate lists for the last year, due to how relatively affordable homes there are, among other factors, such as a slower pace of life.
“Housing markets are healthiest where affordable home prices and strong employment are giving young hopefuls a real shot at buying and starting to build equity,” Anushna Prakash, data scientist for Zillow Economic Research, said.
Last year’s hottest housing market was Charlotte, N.C., according to Zillow. The city fell to seventh place in 2024.
Read More:2024’s hottest real-estate market will be this snowy city, Zillow says
2024-01-04 17:13:00
