I’m a Real Estate Agent: 5 Cities Where Homes Will Be the Best Bargains in 2024
Homebuyers faced many challenges in 2023, including high interest rates and low inventory of homes for sale. But 2024 could give buyers a break in some areas.
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This year, inventory could improve as some sellers accept higher interest rates, rather than feeling like they can’t move and give up their existing mortgage, Zillow predicted. The real estate site also expects housing prices to stay flat in 2024, and even if mortgage rates stay the same too, that could give buyers more time to save money and increase earnings, thereby making homebuying a little more affordable.
“I believe affordability will see a slight improvement in 2024. Rates are expected to decline, but not at a pace that is going to initiate a frenzy among buyers,” said Cody Horvat, licensed real estate broker at The Scott Group, a division of Compass. “This will give buyers a little more breathing room than they received last year.”
But the picture won’t look the same in every area of the country. As the saying goes, real estate is local.
Horvat suggested that, among the largest 20 metros by number of households, the following five will be the best places to find bargains in 2024. Using data from Realtor.com, Horvat analyzed which metros had home prices at or below the national median, combined with the markets expected to see the largest price growth this year. Thus, the data indicates an ability to find affordable homes with the potential for a solid return on investment, he explained.
Detroit
The Motor City could be one of the best places to find bargains in 2024. Average home prices are nearly half the annual median — $235,250 in Detroit vs. $410,000 nationally. Meanwhile, Realtor.com data projects nearly 10% growth in housing prices in the Detroit metro area in 2024.
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Houston
In the Houston metro area, housing prices are higher on average compared to Detroit, coming at $359,900. But here too, homes are expected to grow by a healthy amount — 9.10% — in 2024.
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St. Louis
Another Midwest city also makes this list, with St. Louis home prices coming in at an average of $274,900. Meanwhile, home prices in this metro area are projected to rise by a healthy 4.20% in 2024.
Philadelphia
You might not think of the crowded Northeast as home to many bargains, but the Philadelphia metro area still has below-median housing prices, at an average of $340,000. And housing prices here are expected to grow by 2.30%.
That might not be an eye-popping amount, but as Horvat pointed out, some other big housing markets — like Austin, Denver, Las Vegas, Los Angeles and San Diego — are expected to experience declining prices in 2024, based on Realtor.com data.
Chicago
Rounding out the top five bargain metros is Chicago. In this area, the median housing price is $350,000, which is projected to grow by 2% this year.
“The Midwest was the clear winner, with three cities offering the greatest affordability,” said Horvat.
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Honorable Mentions
While these five metro areas are some of the most populous areas of the country, they still have a good mix of housing affordability and projected price growth. But there are other markets where you can potentially find bargains, too.
“Tampa, [Florida]; Minneapolis; Dallas and Atlanta received notable mentions. While the median home price in these cities was above the national median, they still have relatively affordable housing and positive projected home price growth in 2024,” said Horvat.
In addition, if you don’t want to live in a huge metro area, you can also find bargains in some smaller cities.
For example, Tucson, Arizona; Greensboro, North Carolina and Lakeland, Florida, “all have homes that are more affordable than the national median-priced home, while at the same time, they all have predicted home price increases greater than 5% for 2024. These two factors combined create an affordable bang for your buck,” said Horvat.
Final Take
Overall, buyers have the potential to find good deals in 2024, even though the housing market still has its challenges. One other bright spot could be the upcoming presidential election, not for political reasons but for the housing market effects.
“Historically, during election years, uncertainty has caused the market to slow down a bit. For buyers heading into 2024 with plans to purchase, this could be the perfect time to pull the trigger, as the combination of lower rates and lower competition will tilt the scales in their favor,” said Horvat.
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