As the spring home shopping season unfolds, the housing market paints a diverse picture across different regions. While some areas witness fierce competition amidst limited listings, others enjoy more balanced conditions, reveals the latest market report from Zillow.
"Inventory remains the critical factor influencing competition and price growth," says Zillow's chief economist, Skylar Olsen. "Shoppers should brace for competition, especially for attractive listings on the lower end of the price range — a rare opportunity these days."
Across the board, homes are appreciating fastest in costly coastal California metros and Seattle. Leading the surge is San Jose with a 3.3% increase, closely followed by San Francisco, Seattle, San Diego, and Los Angeles, all showing price growth of 2% or more.
However, these high-cost regions also witness intense bidding wars, with a significant share of homeowners locked into low mortgage rates, making entry for buyers even more expensive.
Conversely, in Southern metros like New Orleans, San Antonio, Tampa, Orlando, and Jacksonville, home price growth is more subdued, with monthly growth just over 0.5%. "New construction in some areas has relieved pressure, and homeowners are less bound by their mortgage," notes Olsen.
Nationwide, the disparity between hot and cold listings persists. In markets where inventory has recovered, buyers are gaining more negotiating power, though well-priced listings are still snapped up swiftly, often within a week.
Affordable Midwestern markets and pricey coastal metros like Seattle and Washington, D.C., boast the shortest time-on-market for sold listings, with homes listed for a week or less in 17 major metros.
However, over 20% of sellers made price cuts in March, the highest percentage for this time of year in over a decade. Markets witnessing the most common price cuts include Tampa, Phoenix, Jacksonville, San Antonio, and Orlando.
Despite this, nearly 27% of homes sold over the asking price in February, indicating robust demand for desirable listings. "Sellers who price their home correctly and enhance their real and digital curb appeal shouldn't have a problem cashing out and moving on," the report suggests.
In summary, the spring housing market presents a varied landscape, with some regions experiencing intense competition driving prices upward, while others maintain a more balanced equilibrium. As the season progresses, buyers and sellers alike should remain vigilant of local market dynamics to make informed decisions.