The Hottest Markets for U.S. Real Estate in March 2021: Are We Back to Normal?
As the weather warms up and the first flowers bloom, home buyers start perking up, too. Spring is traditionally the start of the busiest home-buying season of the year, which extends into summer. And while the coronavirus pandemic completely upended last year’s market, it looks like buyers are back now—and more motivated than ever—according to realtor.com data.
Each month, the realtor.com economic data team ranks the hottest U.S. markets for real estate—those metros where homes are selling fastest and where buyers are clicking up a storm on listings. And whereas last March real estate activity ground to a halt, last month things appeared back to their seasonal norm, with home-buying activity spurred by the eagerness of long-frustrated buyers who have more spending power thanks to relatively low mortgage rates. “One of the things we saw in 2020 is that a lot of people had to put their home-buying dreams on pause,” says Nicolas Bedo, economic research analyst for realtor.com. “As 2021 home buying is starting back up again, we are seeing people return to those locations again.”
Case in point: In March, the top market was Manchester, NH, followed by neighboring metro Concord. And guess which market was also No. 1 at this time last year? Manchester! “It seems like people are picking up again exactly where they left off,” Bedo says. The largest city in New Hampshire, Manchester (whose metro area includes Nashua) is about 50 miles from Boston, while Concord is just a little farther up Interstate Highway 93, meaning residents of those cities could commute to Beantown in about an hour. Plus, New Hampshire’s beaches and ski areas are also within easy driving distance.
But while affordability was the key selling point at this time last year, things were a little different this March. The median listing price of homes in the Manchester-Nashua area was $420,000 in March, up 8.4% year over year. Of course, that still compares favorably with Boston, where median listing prices were hovering around $700,000. Still, on the whole, the hottest markets saw median listing prices 18.9% higher, on average, than the national price in March.
“We’re seeing people be a little more adventurous in the pricing,” Bedo notes. That’s likely because mortgage rates are relatively low, although they have begun to rise in recent weeks and economists predict that the general trend this year will be up. So as long as people have a little more money in their digital wallets, they’re willing to put it down on a place where they may be spending more, but they’re also getting more in terms of space—a key consideration as the pandemic continues. So it looks like home buyers should be ready to move fast, before rates go up too much—and hope that more homeowners decide to put their homes on the market to combat a severe shortage of housing inventory that has contributed to bidding wars in some areas. “It absolutely seems like it’s going to be a competitive season,” Bedo says.
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