Buying Just Keeps Getting More Expensive–Study Shows Home Prices Up in 89% Of US Cities In 2024

Whether it's high interest rates or low inventory, it's impossible to deny prospective homebuyers have gotten a ton of bad news lately and it’s about to get even worse. A recent report by the National Association of Realtors shows that the cost of homeownership increased in 201 out of the 226 metro areas surveyed in Q4 2024. So, you're not imagining things if you feel your dreams of homeownership drifting further out of reach.

If that wasn't bad enough, the study also showed the annual percentage rate on 30-year fixed-rate mortgages increased from 6.12% to 6.85% during the reporting period. The elevated interest rates will only further constrict the options for prospective buyers who had decided to sit out the market until it cooled off. The NAR study also shows America's median home price increased by 50% between 2019 and 2024.

Don't Miss:

• Unlock the hidden potential of commercial real estate — This platform allows individuals to invest in commercial real estate offering a 12% target yield with a bonus 1% return boost today!
• This Jeff Bezos-backed startup will allow you to become a landlord in just 10 minutes, with minimum investments as low as $100.

Those are all crushing blows for would-be homebuyers, but music to the ears of homeowners; especially the ones who locked in low mortgage rates before the COVID-19 crisis. This is a classic case of how your respective position in the homeownership game affects your perspective on the NAR data. Even if you financed at a higher rate in 2021 or 2022, property appreciation has likely put you in a more advantageous position than today's buyers.

NAR Chief Economist Lawrence Yun admitted as much in a statement about the study's results, where he said, "Record-high home prices and the accompanying housing wealth gains are definitely good news for property owners. However, renters who are looking to transition into homeownership face significant hurdles."  Considering that the hurdles appear to be getting even higher, Yun's comments could be the understatement of the decade.

Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — you can become an investor for $0.80 per share today.

The usual suspects on the West Coast dominated the NAR study in terms of America's most expensive real estate markets. Housing affordability has become a major issue in most California real estate markets and the study's results show why. California has five markets with median home prices north of $900,000 and three with median prices over $1,000,000. The most expensive markets in the state are: 

• San Jose–Sunnyvale–Santa Clara ($1,920,000)
• Anaheim–Santa Ana–Irvine ($1,360,000)
• San Francisco–Oakland–Hayward ($1,315,600)
• San Diego–Carlsbad ($985,000)
• Salinas ($943,900)
• Los Angeles–Long Beach–Glendale ($939,700)
• San Luis Obispo–Paso Robles ($927,200)
• Oxnard-Thousand Oaks–Ventura ($920,000)

Prices like that have motivated a years-long exodus of residents from the Golden State to less expensive markets in the Sunbelt, and now they're turning to the Midwest. Zillow's ZG most recent report on America's hottest real estate markets showed multiple surprises in the Midwest, including Indiana, Ohio, and Pennsylvania.

See Also: Commercial real estate has historically outperformed the stock market, and this platform allows individuals to invest in commercial real estate with as little as $5,000 offering a 12% target yield with a bonus 1% return boost today!

This could help explain another interesting finding in the NAR study results. Six of the top 10 markets in terms of year-on-year median home price increases were in the following Midwestern markets:

• Peoria, Illinois (19.6%)
• Fond du Lac, Wisconsin  (17.6%)
• Cleveland-Elyria, Ohio (16.4%)
• Akron, Ohio (15.5%)
• Canton-Massillon, Ohio (14.9%)
• Bismarck, North Dakota (15.8%) 

Ohio might be notorious for cold winters, but the real estate market there is really heating up. The Buckeye State might be a good place to start for real estate investors looking for a market with affordable prices and upside potential. There may also be high potential in neighboring states like Pennsylvania, and Indiana, which both had cities–Philadelphia and Indianapolis–on Zillow's top 10 hottest housing markets list.

Wondering if your investments can get you to a $5,000,000 nest egg? Speak to a financial advisor today. SmartAsset’s free tool matches you up with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.

Looking For Higher-Yield Opportunities In A Shifting Market?

The changing interest rate environment has created an incredible opportunity for income-seeking investors to earn massive yields, but not through dividend stocks… Certain private market real estate investments are giving retail investors the opportunity to capitalize on these high-yield opportunities and Benzinga has identified some of the most attractive options for you to consider. 

For instance, the Ascent Income Fund from EquityMultiple targets stable income from senior commercial real estate debt positions and has a historical distribution yield of 12.1% backed by real assets. With payment priority and flexible liquidity options, the Ascent Income Fund is a cornerstone investment vehicle for income-focused investors. First-time investors with EquityMultiple can now invest in the Ascent Income Fund with a reduced minimum of just $5,000. Benzinga Readers: Earn a 1% return boost on your first EquityMultiple investment when you sign up here (accredited investors only).

Don't miss out on this opportunity to take advantage of high-yield investments while rates are high. Check out Benzinga's favorite high-yield offerings.