The days of affordable homes in Cleveland, Milwaukee, or other affordable housing hubs across the country may be over for good.
new data from red fin It has become clear that home prices in some of these markets are rising at breakneck speed, leaving locals and prospective buyers scrambling for something within their reach.
Cleveland led the way, with home prices rising 15% in the year to December 2024, the largest increase among the nation's 50 largest cities.
Milwaukee (14.5%), Philadelphia (14%), Miami (11.8%) and Chicago (11.1%) followed, with cities once known as havens for more affordable living experiencing double-digit living prices. is experiencing a rise.
Nationally, home prices rose in all 50 metropolitan areas for the first time since May 2022, with the typical home now costing $427,670.
Elijah de la Campa, an economist at Redfin, explained this change: Even places where prices eased some last year, such as Texas and Florida, are now seeing prices rise again. ”
Cleveland's hot housing market is emblematic of this trend.
“Many sellers have very specific numbers in mind, because during the pandemic their neighbors are selling for $40,000 less than their asking price,” Bonnie Phillips, Redfin Premier Agent in Cleveland, said in the survey. “Because I saw it being sold at a store.” “They're willing to walk away if they don't get those numbers, and that's one of the factors that keeps prices high.”
For buyers, this means their dreams of building an attractive home in a sprawling suburb are dashed.
Phillips added, “Cleveland may still have a reputation as an affordable housing haven among out-of-state people, but less so among locals.” Many families are being priced out, and those who can still afford to buy are having to move to less desirable areas.
“Their dream of owning a beautiful farmhouse on 1.5 acres turned into a reality of building a tiny house in the city.”
The jump in prices comes as buyers adjust to rising mortgage rates, which currently hover around 7%. Redfin reports that a combination of high borrowing costs and tight inventories is fueling the increase, even though affordability remains tight.
Meanwhile, regions with previous coronavirus outbreaks, such as Florida and Texas, have seen more modest price increases.
Tampa had the smallest increase among major cities at just 0.5%, followed by Orlando (1.3%), Jacksonville (1.3%), Austin (1.5%) and San Antonio (1.6%).
Home construction is progressing rapidly in these states, which is helping to keep price increases in check. But Florida's housing market faces additional headwinds as buyers shy away from rising insurance premiums and climate risks.
Combined with already high home prices, demand in the Sunshine State has cooled.
