Sellers are sitting in the driver’s seat of today’s idling housing market. So why are they stalled behind the wheel?
Typically, as winter turns to spring, the housing market thaws. Sellers prepare their homes for showings and scrutiny, and buyers review their wish lists and budgets. But with home prices falling from their peaks in many areas, mortgage interest rates around 7{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}, and tons of economic uncertainty, many prospective sellers are still sitting on the sidelines. New home listings, the lifeblood of the real estate market, are down by double-digit percentages over last year.
For some home sellers, apprehension is leading to paralysis. They have plenty of questions: Will buyers show up ready to bid high despite the financial challenges they’re facing? How much should owners be spending on repairs and cosmetic touches to make their homes more appealing? And has the best moment to sell already passed?
While it’s still a seller’s market, the days when a homeowner could list a property that needs renovations, hasn’t been staged (or even cleaned), and receives 25 offers well over the asking price within a weekend are mostly over. Many buyers can’t afford the high prices and rates, so bidding wars have died down, as have offers coming in well over list prices. These days, many sellers are accepting lower offers as their homes languish on the market for months.
However, there are places where sellers have more of an advantage. These are the real estate markets where prices are still strong and homes are still selling briskly. And the data team at Realtor.com® found these top markets for sellers.
Many of these are smaller, more affordable metropolitan areas in the Midwest and South where regular buyers as well as investors can still find bargains.
“There’s a lot of talk about home prices down from the peak,” says Realtor.com Chief Economist Danielle Hale. “But year over year, a lot of markets are still up.”
Many sellers have been reluctant to list their homes, resulting in about 10{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} fewer properties going up for sale in January and February compared with the previous year. One main reason: Most sellers are also buyers, and these days they don’t relish the idea of giving up their current low mortgage rates and emerging into a tight, expensive buyer’s market with much higher rates.
The good news for sellers is the high home equity many have built during the past few years. Even if they can’t get as much as their neighbors did during the height of the COVID-19 pandemic, their homes have still likely increased in value if they’ve had them for a few years.
“Focusing on the very recent fluctuation in prices, you might miss the forest for the trees,” says Hale. “Even if people don’t get the maximum sales price they might have six months ago, the equity is still usually going to equate to a lot of cash. [That] gives them options for their next move.”
To find areas that offer better market conditions for sellers, we looked at the top 150 metropolitan markets over the past year. We focused on those where homes are selling faster than in most of the country and where the price per square foot has risen the most annually. (Metros include the main city and surrounding towns, suburbs, and smaller urban areas.)
In almost every city across the country, the time spent on the market has gone up year over year. In February, homes spent a couple of days short of 10 weeks on the market. That’s up from February 2022, when homes spent about six and a half weeks on the market.
We limited our list to just one metro per state to ensure geographic diversity.
Here’s a look at where sellers can expect to have more welcoming conditions right now.
February median list price: $208,700
Year-over-year increase in price per square foot: +38.4{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
If there’s a housing downturn, someone forgot to tell the good folks of Davenport.
The metro area straddles the Mississippi River, along the border with Illinois, and includes Bettendorf on the Iowa side and two smaller cities on the Illinois side, Moline and Rock Island. The city’s location on a waterway has helped establish it as a regional transportation and trade hub.
It’s also been one of the more affordable markets in the country for a long time. That might help protect it from the current slowdown that’s swept the national housing market.
“We’re very insulated here from a lot of the national trends,” says Delia Dreifurst, a Realtor® at Keller Williams Midwest Partners in Bettendorf.
“The price point is so much lower than on the coasts,” she continues, “so we sit in this sweet spot, where homes still appreciate but they’re also still affordable.”
With a median listing price just below $209,000 in February, Davenport homes cost around half of the national median list price of $414,950, according to the most recent Realtor.com data.
Astonishingly, those prices are up almost 40{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} compared with the same time last year. On top of that, homes are selling faster now than they did a year ago—one of only five of the 150 largest metros across the U.S. where the time homes spent on the market is less now than last February.
The number of homes for sale isn’t enough to satisfy demand, Dreifurst says. So homes that are priced right still receive multiple offers.
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Watch: The Top Real Estate Markets of 2023, Revealed
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February median list price: $301,165
Year-over-year increase in price per square foot: +26.5{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
Alabama’s capital city, Montgomery, is beckoning sellers to put their homes on the block as prices continue rising. But like Davenport, home prices are still well below the national average.
Those lower prices have attracted the interest of Californians. Two-thirds of all the web traffic to listings in the city come from the state, mostly from Los Angeles or the San Francisco Bay Area, where prices can be three to four times higher.
Montgomery, like many U.S. cities, has had its share of struggles. But its downtown has been revitalized over the past several years, heralding real economic growth.
February median list price: $319,995
Year-over-year increase in price per square foot: +19.8{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
Wichita has gone from “Cowtown,” a nickname earned by its history as a popular cattle drive destination, to the aviation capital of the nation. It’s now home to companies such as Airbus, Learjet, and Cessna. Fueled by a strong local economy, it’s also a good place to sell a home.
Among all the cities on the list, Wichita has seen the biggest increase in price per square foot since the middle of 2022, a time when many markets began to see prices stagnate or tick down. The median listing price in Wichita has increased 17.5{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} since June of last year.
Tim Shigley, the owner of Shigley Construction Co. in Wichita, says the biggest reason prices keep rising there is because of the shortage of homes, which is caused by a shortage in the home construction workforce.
“We’re about 20,000 or 30,000 houses short,” Shigley says. “If we had another few thousand skilled construction workers, we might be able to catch up, but it would take years.”
February median list price: $354,262
Year-over-year increase in price per square foot: +18.5{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
Like Wichita, Tulsa has seen a significant price bump since the middle of 2022, when other markets ran out of steam. Since June 2022, the price per square foot is up 13{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}.
However, prices have remained quite reasonable in Tulsa compared with the rest of the nation. It was named one of the best places for middle-class homebuyers by Realtor.com. And the city has some of the most affordable mansions in the country.
Tulsa has especially high buyer interest from out of state, particularly from Chicago, where home prices are about 17{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} higher, and Dallas, where home prices are about 22{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} higher, according to demand data tracked by Realtor.com.
A two-bedroom home within walking distance of the Arkansas River in Tulsa’s Maple Ridge neighborhood goes for about $325,000.
February median list price: $151,575
Year-over-year increase in price per square foot: +18.1{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
Youngstown, located about halfway between Cleveland and Pittsburgh, is by far the least expensive metro in this ranking. The Rust Belt city fell on hard times when the steel mills closed and many residents left the area. But the area is now gaining interest from buyers on the prowl for affordable real estate.
There aren’t as many homes for sale compared with much of the rest of the country. This puts sellers in a better position as buyers are forced to compete over what’s available. And homes aren’t withering on the market in Youngstown—days on the market have grown by just four compared with this time last year.
February median list price: $434,950
Year-over-year increase in price per square foot: +17.1{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
As home to the Mall of America, the largest shopping center in the U.S., as well as the headquarters for megacorporations like Target, Best Buy, and General Mills, Minneapolis has a largely bulletproof housing market. It’s by far the biggest market on this list, with more than 3.6 million residents in the metro area. It’s also the priciest.
“Big cities are expensive,” Hale says. “What you get in Minneapolis is a big city, but without the much larger price tag that usually comes with them.”
In fact, until just the past few months, the median home listing price in Minneapolis was below the national median. But growing demand tilted the market into the less-affordable-than-average column.
Right now, Minneapolis also ties for the lowest number of days that listings spend on the market. The average Minneapolis listing is spending around 7 weeks on the market, about three weeks less than the national average.
February median list price: $283,000
Year-over-year increase in price per square foot: +16.4{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
Home prices in the McAllen metro area, which abuts the U.S.-Mexico border near the southern tip of Texas, continue to rise despite the challenges in the housing market.
McAllen offers a stark contrast to state capital Austin, where home prices skyrocketed over the past several years, but has lately seen one of the sharpest home price declines—a 15{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} median listing price decline since peaking in April of last year.
“We see the McAllen market kind of float above everybody else,” says Roy A. Sawyer, real estate agent at Century 21 Muniz Realty in McAllen.
Sawyer says he’s met with potential sellers who need some coaching before they decide to take the leap, but he often gives people the same advice.
“If you need to buy, buy now. Start building that equity. If you need to sell, sell now. Put your equity to use,” he says. “The best time is now.”
February median list price: $322,400
Year-over-year increase in price per square foot: +16.1{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
Harrisburg, recently named one of the best places in the country to retire by U.S. News & World Report, is another state capital that made the list. The city is about an hour and 20 minutes north of Baltimore and nearly two hours northwest of Philadelphia.
The area is continuing to see plenty of demand from folks coming from different parts of the country, especially New York City, Philadelphia, and Washington, DC.
A classic four-bedroom home in the Harrisburg suburbs goes for about $330,000.
February median list price: $304,245
Year-over-year increase in price per square foot: +15.9{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
Arkansas’ capital city, Little Rock, is a dynamic college town (University of Arkansas, Philander Smith College), with a bustling downtown river walk district that helps impart an urban feel to the Southern capital. Homes here keep gaining in value, despite the national slowdown.
The metro had some of the biggest home price increases in the nation last year, according to a Realtor.com analysis. It also tied with Minneapolis for the lowest median number of days spent on the market, at just a hair more than seven weeks.
That’s all great news for sellers eager for a swift, profitable sale.
Right now, the average home price in Little Rock will get a small, three-bedroom home built in 1920 in the historic and desirable Hillcrest neighborhood.
February median list price: $457,116
Year-over-year increase in price per square foot: +13.0{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502}
Real estate prices in this city, home to the University of Tennessee, have continued to rise. That’s distinguished it from nearby, pricier Nashville, where prices have dropped around 4{515baef3fee8ea94d67a98a2b336e0215adf67d225b0e21a4f5c9b13e8fbd502} from their high in June 2022. (The median home list price in Nashville was about $510,000 in February.)
Regina Santore, a Realtor at Coldwell Banker Wallace in Knoxville, says she still regularly sees homes that get multiple offers.
“We did have a brief, quiet moment late last year, when everyone kind of held their breath wondering if the bottom would fall out of the housing market,” she says.
But that passed and things are moving fast again.
“I just had a listing in the university area that was booked for showings every half-hour for two days,” she says. “There were nine offers, and it went for $45,000 over the asking price. No contingencies. No inspection.”
