Last year was a challenging time to sell a home. But if you thought fewer homes being sold would pull down prices, you would be mistaken.
In fact, the U.S. housing market experienced a notable surge in home prices during the fourth quarter of 2024, with 89% of metro areas witnessing an increase in single-family existing home sales prices. This marks a rise from 87% in the previous quarter, according to the latest report from the National Association of Realtors.
The national median price for single-family existing homes climbed 4.8% year-over-year to $410,100. Notably, 14% of the 226 tracked metro areas recorded double-digit annual price appreciation, a significant jump from 7% in the third quarter.
"Record-high home prices and the accompanying housing wealth gains are definitely good news for property owners," NAR Chief Economist Lawrence Yun said in a press release. "However, renters who are looking to transition into homeownership face significant hurdles."
The South led the nation with the largest share of single-family existing-home sales at 45.1%, experiencing a year-over-year price increase of 2.1%. Other regions also saw price hikes, with the Northeast up by 10.6%, the Midwest by 8.0%, and the West by 4.0%.
The Midwest dominated the list of top-performing metro areas, but Jackson, Mississippi, led the nation with a 28.7% increase in median home prices. Other notable markets included Peoria, Illinois (19.6%), and Chattanooga, Tennessee-Georgia (18.2%).
California remained home to eight of the top 10 most expensive markets, with San Jose-Sunnyvale-Santa Clara topping the list at a median price of $1,920,000.
A few metros saw lower prices
Despite the overall rise in prices, nearly 11% of markets saw declines, down from 13% in the previous quarter. Yun noted that workers with the flexibility to relocate might find more affordable housing options elsewhere.
Housing affordability showed slight improvement, with the monthly mortgage payment on a typical single-family home with a 20% down payment decreasing to $2,124, down 1.7% from a year ago. First-time buyers also saw improved conditions, with the monthly payment on a typical starter home dropping to $2,083.
A family needed a qualifying income of at least $100,000 to afford a 10% down payment mortgage in 43.8% of markets, while only 2.2% of markets required less than $50,000, consistent with the previous quarter.
Email Mark Huffman mhuffman@consumeraffairs.com
