Real Estate News & Commentary

The 10 Real Estate Markets With Highest Home Price Appreciation

Expertise: Personal Development, Real Estate News & Commentary
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home_price_appreciation

Today RealtyTrac released its November 2014 Residential & Foreclosure Sales Report, which details median prices for sales of residential properties nationwide. The data indicates the median sales price of single family homes and condos across the U.S. to be $190,000 in November, up 15 percent from a year ago. Distressed homes, defined as those in foreclosure or bank-owned, reached a median sales price of $128,625, the highest since December 2009 and up 18 percent since the same time last year.

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The median sales price of both non-distressed and distressed properties in some stage of foreclosure was up 35 percent in the month of November from the low point of $141,000 in March 2012.

"Home price appreciation on average was 6 percent among all metro areas with a population of 500,000 or more," said RealtyTrac vice president Daren Blomquist. "We saw strong price appreciation in Rust Belt cities like Detroit, Cleveland and Chicago contrasted with single-digit price appreciation in many coastal California markets, Phoenix, Las Vegas, and the District of Columbia."

The 10 Real Estate Markets With Highest Home Price Appreciation

Nationwide, the share of homes with pricing above $200,000 increased, while those priced below $200,000 decreased, with the biggest increase in share of home sales in the $500,000 to $1 million range, up 20 percent.

Related: Why Investors Undeniably Matter to the Real Estate Market

The biggest increase in median sales price among metro areas with populations of 500,000 or more were as follows:

10. Miami, FL (up 13 percent)

9. Chicago, IL (up 13 percent)

8. Atlanta, GA (up 15 percent)

7. Memphis, TN (up 16 percent)

6. Houston, TX (up 16 percent)

5. Lakeland, FL (up 18 percent)

4. Modesto, CA (up 18 percent)

3. Dayton, OH (up 20 percent)

2. Toledo, OH (up 23 percent)

1. Detroit, MI (up 32 percent)

Metro areas nationwide also saw major home price appreciation acceleration, with 42 of 102 areas surveyed seeing more growth this year than the previous year. Markets with the most dramatic acceleration of appreciation included Dayton, OH, Akron, OH, Tulsa, OK, Augusta-Richmond County, GA-SC and Lancaster, PA.

home_appreciation_acceleration

Source: RealtyTrac

 

What Does This Mean for Investors?

Investors will likely notice a shift in the areas where investing in real estate is most profitable.

Says Blomquist, “Twenty states still saw annual decreases in distressed property prices so we will continue to see a fragmented recovery as investors move from once hot markets such as Phoenix, Atlanta and many California markets and into markets such as Charlotte, Columbus, Ohio, Dallas and Oklahoma City.”

While short sales and distressed sales accounted for 12.6 percent of all residential property sales, down from 14.8 percent in November 2013, certain areas did see an increase in short sales and foreclosure auction sales (so if you’re in those areas, you might want to learn more about the short sale process and foreclosure process!).

Related: 6 KEY Attributes that Affect the Risk Level of a Rental Market

The five states that saw an increase in shares of short sales compared to last year were:

  • Rhode Island (from 0.1 percent last year to 3.6 percent this year)
  • West Virginia (from 1.0 percent last year to 2.4 percent this year)
  • Vermont (from 0.7 percent last year to 1.5 percent this year)
  • New Jersey (from 5.2 percent last year to 6.2 percent this year)
  • Illinois (from 7.2 percent last year to 7.3 percent this year)

The biggest increases in annual shares of foreclosure auction sales occurred in the following metro areas:

  • Cincinnati, OH (from 0.6 percent last year to 3.4 percent this year)
  • Jacksonville, FL (from 2.4 percent last year to 4.9 percent this year)
  • Orlando, FL (from 2.1 percent last year to 4.3 percent this year)
  • Lakeland, FL (from 4.2 percent last year to 6.3 percent this year)
  • Louisville, KY (from 0.8 percent last year to 2.9 percent this year)

The markets with the highest short sale and distressed sale shares were concentrated in Las Vegas, Central California and Florida.

Screen Shot 2014-12-30 at 4.37.51 PM

Source: RealtyTrac

How Will You Use This Information to Inform Your Investing Decisions?

The “hot” real estate markets have shifted within the past year — so where do you see yourself investing next?

Will you take advantage of the places where short sales and foreclosure auctions are on the rise?

Have you seen much change in your local market?

Leave a comment below, and let’s discuss!

A career writer, editor and blogger, Allison serves as the Director of Content for BiggerPockets.com. In the past, she has channeled her passion and curiosity for all things real estate into her jo...
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    Scott Trench President of BiggerPockets from Denver, CO
    Replied over 5 years ago
    Interesting Data – I want to cheekily point out that Josh has spent the last two years discouraging investment in Detroit via the BP Podcast ;). In the last two years, that market has performed better than any in the country hmmm.
    Allison Leung from Denver, CO
    Replied over 5 years ago
    Hahah Scott. I knew I could count on you to stir the pot.
    Joshua Dorkin BiggerPockets Founder from Denver, CO
    Replied over 5 years ago
    Now, now Scott . . . there you go taking things out of context. Detroit is the poster child of a broken city and has been for some time. While I definitely rip on D-Town, I only discourage people from investing there that know nothing about the city. Buying real estate in a market because it is cheap or hot is an easy way to get yourself in trouble if you don’t know much about what’s really happening. Remember, real estate is local and even within a city, there are countless pockets. I’m glad that things are slowly coming back around. That said, I would still discourage new investors FROM OUT OF TOWN from buying there unless they take the time to learn the market.
    Julie
    Replied over 5 years ago
    When houses are selling for a dollar, it’s easy for them to go up…
    Jeff Brown from San Diego, CA
    Replied over 5 years ago
    Exactamundo, Julie.
    Andrea
    Replied over 5 years ago
    My understanding is that the increase in sales in Florida is due to changes in the law which made it easier for banks to sell. I’m assuming that once the inventory has decreased due to intensive selling by banks now, sales will also decrease. I’d be interested to hear responses.
    Paul Lopez Real Estate Investor from Tehachapi, California
    Replied over 5 years ago
    This is my first post on BP. So Please forgive my nervous response to Josh. I think you are right on, as far as advising newer investors to be very careful in a new area.
    Joshua Dorkin BiggerPockets Founder from Denver, CO
    Replied over 5 years ago
    Thanks for the comment, Paul. Otherwise, jump in and don’t be nervous. I’d start with a new member introduction on our forums when you have a chance!
    Brandon Sturgill Real Estate Broker from Columbus, OH
    Replied over 5 years ago
    This data seems pretty superficial…I know you are looking for things to post on BP, but how about something of substance. Would you care to elaborate on this information. Demographically speaking, Dayton is one of the worst cities I have ever seen…
    Allison Leung from Denver, CO
    Replied over 5 years ago
    Hi Brandon: Thanks for commenting. While we don’t do a large percentage of news-based posts, if we come across data that we feel could help our readers stay informed, we strive to share that information. We are not necessarily giving a value judgment, but if our readers give input on the data in the comments, all the better — we’d love to see a lively discussion regarding what this info means to folks!
    Joshua Dorkin BiggerPockets Founder from Denver, CO
    Replied over 5 years ago
    The intent wasn’t to make judgement, but to share some data points. Since people turn to us to keep up with what’s going on, we do our part to share any data we find relevant and let our users take it from there. We’re not encouraging people to invest in these markets; just sharing the facts.
    Daniel Morgan Real Estate Investor from Springfield, Massachusetts
    Replied over 5 years ago
    Great post Allison! This data is so vauleable for a newbie such as myself. Thanx
    Allison Leung from Denver, CO
    Replied over 5 years ago
    Hi Daniel! So glad you found it helpful. Thanks for commenting!
    Tyler Flagg Investor from Pensacola, FL
    Replied over 5 years ago
    Great info Allison. I’ve never really paid much mind to “big picture” real estate metadata. However, this article has definitely got me thinking. I’ll be sure to start checking out RealtyTrac now. Thanks!
    Miguel Nava Rental Property Investor from Houston, TX
    Replied over 3 years ago
    Hello, I know this blog/post is old but what are your thoughts on Akron, OH? I’ve heard it is a good place/market to invest. Thanks, Miguel