4 Cities To Avoid Buying Homes This Fall
Fall often brings to mind cozy sweater weather, the leaves changing colors and pumpkin decorating. But if you’re planning on buying a home this fall, there might be some cities you should think twice about calling home.
Housing Market 2023: 40 Places Poised for a Housing Crisis
See: 3 Things You Must Do When Your Savings Reach $50,000
Low property values, uncertain economic outlooks and weak housing markets are some of the issues that have caused these towns not to make the cut when finding your dream home this fall.
Here are four U.S. cities you should avoid if you’re searching for your next place to call home this fall.
Also see why fall is the best time to buy, in the right areas.
Los Angeles
Los Angeles is a high-priced real estate market, making it difficult for first-time homebuyers or middle-class families. The median home sale price in Los Angeles is $980,000, according to Redfin.
The cost of living in Los Angeles is 50% higher than the national average, making it an expensive place to live and own a home. Even more alarming, housing in Los Angeles is 135% higher than the national average, per Redfin.
I’m a Real Estate Agent: These Will Be the Best States To Buy Property in the Next 5 Years
San Francisco
San Francisco is another very competitive and expensive real estate market. San Francisco’s limited space, high demand and well-paying job market have contributed to this market. However, as remote work continues to evolve, there may be a potential future shift in demand. Currently, prices remain high. The median sale price of a home in San Francisco is currently $1.4 million, according to Redfin.
The cost of living in San Francisco is 74% higher than the national average, which means, just like Los Angeles, it’s an expensive place to live and own a home. Alarmingly, housing in San Francisco is 228% higher than the national average.
“Historically, San Francisco has been known as a haven for tech-savvy professionals and a hotspot for real estate, but now it’s experiencing a paradigm shift,” said Bailey Moran, COO of Austin TX Realty, an Austin-based boutique real estate brokerage. “Prices are skyrocketing, but many locals are growing weary of the city’s increasing cost of living. This mismatch between home value and overall quality of life can’t last forever. While San Francisco homes may seem like a solid investment, future depreciation is a real concern. So, buyers should exercise caution here.”
Pasadena Hills, Florida
The housing market in Pasadena Hills is very competitive, with homes selling after an average of only 18 days on the market. However, prices are already starting to go down. The median sale price of a home in Pasadena Hills is $374,000, down 15.5% since last year, per Redfin.
You also might have to pay higher insurance costs if buying a home in Florida, due to the state’s weather events like hurricanes.
Las Vegas
Las Vegas is known for its entertainment and hospitality industry. However, Las Vegas is also known for its volatile real estate market, which can be influenced by tourism and the economy. Therefore, local demand can be less predictable in Las Vegas.
The median sale price in Las Vegas is $413,00, a 1.9% increase compared to last year. The living and housing costs in Las Vegas are close to the national averages. The cost of living is 1% lower than the national average, and housing in Las Vegas is 2% higher than the national average.
Factors To Consider When Deciding Which Real Estate Markets To Avoid
We looked at several factors when deciding which real estate markets to avoid. Among others, these included median sale price, local demand, cost of living and housing affordability.
Median sale price
The median sale price is important when deciding whether you can afford a home in a real estate market. If the median home sale price is well outside your budget, you may have difficulty finding a home you can afford.
Unless you have a high budget or are willing to outbid potential competitors, you may want to proceed cautiously in these markets.
Local demand
You also want to buy a home with good local housing demand and a historically stable or up-and-coming housing market. Buying a home in an unpredictable, volatile or dying market can make it difficult to sell in the future. At the same time, having too much local demand can lead to bidding wars.
Cost of living
If the cost of living is too expensive for your salary, it may not be the right location for you. The cost of living includes groceries, child care, dining, entertainment, transportation, gas and more.
Generally, places with a higher cost of living have higher salaries, but not always. However, this may not apply to you if you have a remote job, are unemployed, retired or self-employed. Be sure to do your research and consider your individual financial situation.
Housing affordability
Housing is typically the biggest expense for most Americans. Experts recommend spending no more than 25% to 30% of your gross pay on housing. In some markets, this may be difficult or nearly impossible unless you have an extremely high-paying job.
Bottom Line
Real estate markets are constantly changing, but looking at trends, data and predictions can help you determine which markets to choose and which to avoid. Deciding where to buy a home will depend on your individual priorities, budget, circumstances and other factors. Regardless of which home you decide to buy, make sure to do your research and consider long-term financial goals and priorities.
More From GOBankingRates
This article originally appeared on GOBankingRates.com: 4 Cities To Avoid Buying Homes This Fall
