There are various reasons why someone may want to consider buying a house. While buying a house is just one component of the American Dream, under the right circumstances, there are more rewards you can reap from such an investment, such as long-term appreciation, tax benefits, and providing an additional form of income by renting. Despite the heavy tick in housing costs in recent years, there are still pockets in the country where housing markets offer something for homeowners to gain.
According to new projections from Realtor.com, several housing markets in the West and Midwest are on track to join the million-dollar club within the next decade.
Where the Housing Markets Are Hot
Boise City, Idaho, is the leader of the pack of surfacing high-value housing markets. With a growing tech scene, affordable healthcare, and beautiful natural surroundings, Boise has become one of the fastest-growing cities in the country. A large factor attracting new residents to this outdoor haven is the cost of living; Boise offers big-city amenities for small-town prices, making it a desirable location for residents from states like California, Washington, and Oregon looking to move.
The capital of the Gem State is expected to see its median home prices climb from the current $464,578 to nearly $1.2 million by 2033. This prediction is based on Boise’s 58.2% price growth rate observed between 2014 and 2019.
Examining price trajectories in America’s 100 largest metros, the analysis further points to a broader trend of rising valuations in housing markets near existing high-cost areas. A perfect example is Stockton. Located in California’s Central Valley, this city’s housing prices are projected to read $1.4 million by 2033, quite the increase from today’s median of $579,292.
“As the prices increase and price folks out of the immediate San Francisco Bay Area, people will venture further out into the Valley,” Nicole Brown, global real estate advisor at Corcoran Icon Properties, said to Realtor. “Stockton is a great location positioned between the metros of San Francisco and Sacramento.”
Other housing markets, including Salt Lake City, Portland, and Colorado Springs, are also set to see some sunshine on appreciation values. These areas are all expected to see housing appreciation values cross the million-dollar threshold within ten years. Denver and Sacramento, whose housing markets are predicted to see substantial increases, with median prices potentially reaching $1.3 million and $1.1 million, respectively, are also reaching seven figures.
Despite its speedy growth, areas in the Sun Belt region of the country show quite different dynamics. “Even though the Sun Belt is growing fast, there’s still a lot of land and cheaper housing,” Yancy Forsythe, owner of Missouri Valley Homes, said in the report. “The availability of land makes it easier to build new homes, which keeps prices from jumping too high.”
Caution with Current Trends
Hannah Jones, an economist at Realtor.com, wants to caution potential homebuyers that these projections are based on current housing trends and the assumption that they will continue.
“If the local economy shifts, demand could fall, and prices may not keep up with recent growth,” Jones said. “On the supply side, home construction could pick up, taking some pressure off of inventory, which would allow for slower price growth.”
The analysis made predictions based on pre-pandemic data from 2014-2019 to avoid market distortions caused by recent economic troubles. It then applied those growth rates to the current prices to arrive at a number for the 10-year forecasts.
Using this measure, Seattle’s housing market tops the list, with prices possibly reaching $1.48 million by 2033, a significant leap from the current $694,351.
According to Realtor.com’s data, other areas to watch out for on the list include Boston and Honolulu. Beantown’s values are expected to see a 26.2% growth rate, with the current median price of $622,902 rising to $991,804 by 2033. Honolulu’s median price of $683,086 is predicted to rise by $1,143,830 by 2033, a growth rate of 29.4%.
