Home purchase demand remained strong in low-cost cities with strong local economies in the third quarter, helping push Johnson City, Tenn., to the top of The Wall Street Journal/Realtor.com Emerging Housing Markets Index.
Rising mortgage rates have made most home purchases less affordable and pushed many buyers out of the market. Existing home sales fell for eight straight months through September. Homes stay on the market longer, and more sellers are lowering prices.
The buyers’ focus on affordability benefited Johnson City. The median listing price for the metro area was $379,000 in September, up 27% from a year earlier, according to Realtor.com, while median listing price growth nationwide was 14%. Johnson City’s median listing price was $48,000 below the median listing price nationwide last month.
The index identifies the top metropolitan areas for homebuyers seeking an appreciating housing market, a strong local economy and an attractive lifestyle. News Corp, parent of the Journal, operates Realtor.com.
Johnson City, a metropolitan area of about 205,000 people, was followed in the ranking by Visalia, California; Elkhart, Ind.; North Harbor, Florida; and Fort Wayne, Ind.
“These more affordable markets continue to offer some opportunity,” said Danielle Hale, chief economist for Realtor.com. “It doesn’t mean they’re not seeing a slowdown in their real estate markets, but they’re better positioned overall.”
The Wall Street Journal/Realtor.com Emerging Housing Markets Index ranks the 300 largest metropolitan areas in the U.S. In addition to housing market indicators, the index incorporates economic and lifestyle data, including real estate taxes, unemployment, wages, travel time, and small business loans.
Most of the top-ranked markets in the third quarter had faster home sales and lower unemployment rates than the market as a whole, Ms. Hale said.
Johnson City, which is in northeast Tennessee near the North Carolina and Virginia borders, had the highest demand ranking of the 300 metro areas in the index.
Downtown Johnson City is the heart of a metropolitan area that is home to some 205,000 people.
The community, which has an unemployment rate below the national average, has been attracting home shopping activity from the state’s most expensive cities and East Coast hubs such as Washington, DC, Atlanta and Charlotte, NC. said Mrs. Hale. Major local employers include East Tennessee State University and Johnson City Medical Center, and the area offers easy access to the Appalachian Trail and water sports.
Courtney Shaw of Re/Max Checkmate Inc. Realtors in Johnson City said that since the start of the pandemic she has worked with buyers from Oregon, California, New York and other states who were attracted by low home prices, taxes and price increases in the area. the nearby mountains.
“They were selling for a profit in their states and coming here where everything is so much more affordable,” he said. Many of the newcomers were retirees, while others were remote workers, she said. “A lot of people who come here tell me that high-speed Internet is a major factor for them,” she said.
Like many small cities and towns during the pandemic, Johnson City and local organizations have started a program offering $2,500 or more to full-time remote workers who move into town. About 280 people have applied for the program and 40 have been accepted so far, said Alicia Phelps, executive director of the Northeast Tennessee Tourism Association.
Demand from homebuyers in the area has decreased due to higher mortgage rates, but the market remains competitive, Ms. Shaw said. Her most recent listings, one in September and one in October, received multiple offers, she said.
Five of the top 20 markets in the third quarter They were in Florida including North Port at #4, Tampa at #11, Cape Coral at #12, Naples at #16, and Orlando at #18. Most data used in the index they capture the period before Hurricane Ian. it made landfall in Florida in late September and caused billions in property damage.
Some Western markets that ranked highly last quarter fell in third-quarter rankings, including Boulder, Colo., Santa Cruz, Calif., Vallejo, Calif., and Eureka, Calif. Coeur d’Alene, Idaho, which topped the inaugural ranking. Wall Street Journal/Realtor.com Emerging Housing Markets Index in the first quarter of 2021, ranked 23rd in the most recent rankings.