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colorful houses in San Francisco
Alexandra Biesada

The 20 Hottest US Real Estate Markets

by Alexandra Biesada | Dun & Bradstreet Editor

September 1, 2015 | No Comments »

colorful houses in San FranciscoHow healthy is the US housing market? It depends on whom you ask. If you happen to ask a resident of San Francisco, Dallas, or Denver — the three hottest real estate markets in August, according to realtor.com — you’ll get a very different answer than if you ask some poor soul in Cumberland, Maryland, or Kingston, New York, where homes values are falling fast.

The uneven recovery of the US housing market mirrors the diverging fortunes of individuals in the US economy. Some are doing just great, while others are barely getting by.

Of the 20 hottest residential real estate markets in the US, 11 are in California and four are in Texas. The rest are sprinkled among university towns in Ohio, Michigan, and Tennessee. Interestingly, Detroit ranked 13th on realtor.com’s hot list, with high demand and low supply driving home sales there. Homes in these hot markets sell relatively quickly (between 29 and 48 days faster) compared with homes in the rest of the country.

20 Hottest US Real Estate Markets

  1. San Francisco, CA
  2. Dallas, TX
  3. Denver, CO
  4. Vallejo, CA
  5. Santa Rosa, CA
  6. San Jose, CA
  7. San Diego, CA
  8. Midland, TX
  9. Sacramento, CA
  10. Columbus, OH
  11. Ann Arbor, MI
  12. Santa Cruz, CA
  13. Detroit, MI
  14. Los Angeles, CA
  15. Oxnard, CA
  16. Stockton, CA
  17. Yuba City, CA
  18. Austin, TX
  19. San Antonio, TX
  20. Nashville, TN

Source: realtor.com

Would-be home buyers in markets where sellers rule might be surprised to learn that homeownership rates in the US are at their lowest point in more than 20 years and falling. Indeed, the seasonally adjusted homeownership rate in the US continued its downward trend in the first half of 2015, ending June at just 63.4%, the Commerce Department reports.

Why so low? Many new households are renting, which drives down the homeownership rate as a percentage of total households. Also, the rate of homeownership among the all-important Millennial generation is low and getting lower. Among those less than 35 years of age, the rate of homeownership averaged 34.7% in the first half of the year, down from nearly 39% five years ago. By comparison, the rate of homeownership among their parents (55 to 64 years) is about 75%.

As a resident of Austin, TX (#18), I can attest that it’s a sellers’ market despite being rated as the US’s most overvalued housing market by Forbes in June.

Alexandra Biesada shops every day, whether she wants to or not, and pines for the days when it was strictly a recreational activity. She has covered the retail beat for Hoover’s since 2001. Follow her on Twitter.

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