Last week, NAR released its latest quarterly metropolitan price and affordability figures. The lion’s share of metropolitan areas continued to experience strong year-over-year price growth in the fourth quarter. A companion metro area annual affordability report shows less favorable conditions, particularly in the West.
The median existing single-family home price increased in 73 percent of measured markets, with 119 out of 164 metropolitan statistical areas (MSAs) showing gains based on closings in the fourth quarter compared with the fourth quarter of 2012.
NAR’s national annual Housing Affordability Index, with breakouts for metropolitan areas, fell to 175.8 in 2013 from a record high 196.5 in 2012. For first-time buyers making small downpayments, the affordability levels are relatively lower. The index is calculated on the relationship between median home price, median family income and average effective mortgage interest rate. The higher the index, the stronger household purchasing power; recordkeeping began in 1970.
Common sense says where there are jobs, there are better home sales and commercial leasing opportunities. So which markets are generating jobs and which are not?
- The fastest job creating large cities over the past 12 months:
- Austin, TX (+3.8%)
- Nashville, TN (+3.7%)
- Dallas-Ft. Worth, TX (+3.6%)
- Houston, TX (+3.4%)
- The fastest job creating small towns over the past 12 months:
- Santa Cruz, CA (+6.2%)
- Midland, TX (+5.6%)
- Winchester, VA (+5.6%)
- Odessa, TX (+5.0%)
- By comparison, the U.S. job growth rate as a whole is 1.6 percent.
- Unfortunately, there are still areas where jobs are being cut, and the notable ones are:
- Atlantic City
- One market with a long streak of job creation is Bismarck, ND. The unemployment rate is only 2.4 percent. Menial jobs such as that of cashier at McDonalds earn near $20 per hour. Oil and gas workers are at near $100,000 per year.
- A tribute goes out to those people moving from say Cleveland to North Dakota in search of work. Though disruptive on many levels, there is something noteworthy and patriotic about people seeking out and making a long-distance move, particularly to a non-weather friendly region, in order to get off of unemployment and into a good paying job. Based on a few anecdotal stories from local REALTORS®, the new arrivals into the northern plains are said to be liking it as a good place to raise family.