Housing Market: Best to Avoid Home Purchases in These 4 Cities
In the quest for affordable housing amid rising home prices, especially for prospective buyers in California, it becomes crucial to identify cities where housing costs are more reasonable. In January 2024, CBS presented significant findings from CoreLogic, a real estate firm, highlighting 20 U.S. cities poised for residential real estate price gains, with Redding, a Northern California city, emerging as the top gainer with a potential 7.3% increase in home prices predicted by CoreLogic. According to Zillow, the current average home value in Redding is $375,981, experiencing a slight dip of 0.2% over the past year.
On the contrary, San Francisco’s reputation for having prohibitively expensive real estate appears unlikely to diminish significantly. Redfin’s 2023 analysis identified San Francisco as one of the least affordable housing markets, revealing that typical local homebuyers would need to allocate over 80% of their income to monthly housing costs. While Realtor.com anticipates a projected decline of -5.2% in San Francisco’s home prices this year, it might not be substantial enough to influence potential buyers. San Francisco holds the sixth position in U.S. News’ 25 Most Expensive Places to Live in the U.S. for 2023-2024 and ranks tenth among the world’s most expensive cities in the EIU’s Worldwide Cost of Living 2023 report.
Los Angeles, the second most expensive U.S. city to live in, grapples with a high cost of living and a scarcity of affordable housing. Zillow reports an average home value of $918,087 in Los Angeles, marking a 3.5% increase over the past year. The Zebra places Los Angeles in sixth position on its list of the 10 most expensive cities to own a home in 2024, citing factors like a tight housing inventory and expensive property taxes as deterrents to interested buyers. Additionally, Los Angeles ranks sixth in the Worldwide Cost of Living 2023 report.
In San Diego’s 2024 housing forecast, several noteworthy aspects come into play. Realtor.com projects San Diego to be among the top five Californian metros, expecting a robust 13.1% average sales growth. Furthermore, San Diego stands out as a leader in veteran households utilizing VA loans, boasting a 16.5% share, nearly double the largest 100 market average. However, the optimism surrounding sales growth is tempered by the reality that the average home value in San Diego, at $960,202, is the highest among the cities mentioned, reflecting a 7.1% increase over the past year.
