Home prices finished 2024 strong, NAR data shows. But in the last five years alone, median home prices have jumped 50%.
Property owners are getting richer as home prices prove resilient against lower home sales. Nearly 90% of metro areas registered home price increases in the final quarter of 2024, according to the latest housing data from the National Association of REALTORS®. Fourteen percent of the 226 metros NAR tracks posted double-digit price gains, up from 7% in the third quarter.
“Record-high home prices and the accompanying housing wealth gains are definitely good news for property owners,” says NAR Chief Economist Lawrence Yun. “However, renters who are looking to transition into homeownership face significant hurdles.”
The high home prices are making it difficult for real estate newcomers to save up for a down payment. Still, FOMO may be setting in for those would-be homeowners as wealth accumulation for homeowners far outpaces that of renters. The spread in median net worth between homeowners and renters stands at $415,000 for homeowners versus $10,000 for renters, NAR has previously reported.
Where Home Prices Are Gaining the Most
The national median price for a single-family existing home rose nearly 5% in the fourth quarter of last year compared to a year earlier, settling in at $410,100, NAR’s fourth-quarter data shows. In the last five years alone, median home prices have jumped 50%.
In the fourth quarter, home prices in the Northeast saw the largest gains, up 10.6%, followed by an 8% increase in the Midwest, 4% in the West and 2.1% in the South, NAR’s report shows.
The following metro areas posted the largest year-over-year median home price increases in the fourth quarter:
1. Jackson, Miss.: 28.7%
2. Peoria, Ill.: 19.6%
3. Chattanooga, Tenn.-Ga.: 18.2%
4. Elmira, N.Y.: 17.6%
5. Fond du Lac, Wis.: 17.6%
6. Cleveland-Elyria, Ohio: 16.4%
7. Bismarck, N.D.: 15.8%
8. Akron, Ohio: 15.5%
9. Blacksburg-Christiansburg, Va.: 15%
10. Canton-Massillon, Ohio: 14.9%
Housing Affordability Slightly Improves
Despite the widespread home price gains, housing affordability “marginally improved” in the fourth quarter, according to NAR. The monthly mortgage payment on a typical existing single-family home was $2,134 (assuming a 20% down payment). That is down by 1.7%—or $37—compared to a year ago, NAR reports.
Households are still devoting a big percentage of their income to pay their housing bills, however. Families devoted about 25% of their income to mortgage payments, yet down from 26.5% last year. First-time home buyers typically spent 37.4% of their family income on mortgage payments, which also is an improvement from 38.1% in the prior quarter.
“While recognizing many workers may not have the option to relocate, those who can or are willing to move may find more affordable conditions—especially given the wide variance in home prices nationwide,” Yun says.
Priciest, Most Affordable Housing Markets
California continued to dominate the list of the most expensive housing markets in the country, with San Jose topping the list. Single-family homes there reached a median price of $1.9 million in the fourth quarter, NAR reports. That’s a big difference from the least expensive single-family housing market in the country in Decatur, Ill., which had a median price of $135,100.
The most expensive markets for single-family homes in the fourth quarter of 2024 were:
1. San Jose-Sunnyvale-Santa Clara, Calif.: $1.92 million
2. Anaheim-Santa Ana-Irvine, Calif.: $1.36 million
3. San Francisco-Oakland-Hayward, Calif.: $1.315 million
4. Honolulu, Hawaii: $1.103 million
5. San Diego-Carlsbad, Calif.: $985,000
The least expensive markets for single-family homes in the fourth quarter were:
1. Decatur, Ill.: $135,100
2. Cumberland, Md.-W.Va.: $156,300
3. Youngstown-Warren-Boardman, Ohio-Pa.: $163,800
4. Elmira, N.Y.: $167,800
5. Peoria, Ill.: $172,400
The most expensive markets for condo co-ops were:
1. San Francisco-Oakland-Hayward, Calif.: $887,700
2. Los Angeles-Long Beach-Glendale, Calif.: $674,100
3. San Diego-Carlsbad, Calif.: $668,300
4. Boston-Cambridge-Newton, Mass.-N.H.: $596,100
5. Barnstable Town, Mass.: $568,900
The least expensive markets for condo co-ops were:
1. Greensboro-High Point, N.C.: $155,900
2. Winston-Salem, N.C.: $171,900
3. Tallahassee, Fla.: $178,400
4. Cleveland-Elyria, Ohio: $179,000
5. Bismarck, N.D.: $200,000
Source: nar.realtor
