Photo: Bernard Spragg.NZ/Flickr

The US housing market may be cooling in some larger metro areas, but it’s just heating up in many of the country’s smaller markets, according to a new housing report by Realtor.com.

“The housing market is a Tale of Two Cities as the divergence widens between high-cost, large urban areas, and smaller, more affordable markets,” said Danielle Hale, chief economist for Realtor.com, in a statement.

At the national level, the median home price rose 9 percent year-over-year to $293,000, which was down slightly from October but is “in line with the seasonal pattern.” November’s gain was higher than last year’s increase of 8 percent.

Out of the top 45 metros, 35 recorded year-over-year price gains in November. However, only 8 markets outpaced the national growth rate of 9 percent.

“This indicates that although prices are still increasing nationally, the gains are predominantly from smaller markets,” reads the report.

Chattanooga, TN (17 percent), Spokane, WA (15 percent), and Greensboro-High Point, NC (14 percent) posted the highest year-over-year median list price growth.

The steepest price declines were seen in the white-hot San Jose, CA market, and in Austin, TX, which were both down 4 percent, or $41,000 and $15,000, respectively.

Overall, 22 percent of all home listings saw price reductions in November, up from 19 percent a year ago. The increase is being driven by the nation’s largest markets — 40 of the 45 top markets saw an increase in price reductions in November.

“Buyers in larger metros are seeing more homes on the market and listing prices decline, while those in smaller markets continued to see price increases,” says Hale.

Meanwhile, national housing inventory rose 4 percent year-over-year in November. But in the nation’s largest —and most expensive —  metros, inventory increased at a more rapid 9 percent.

Many hot West Coast markets, where high demand is fueling price growth, saw large inventory gains in November. Seven of the 10 markets that posted the largest year-over-year inventory increases are located on the West Coast, and five were in California, including San Jose, San Francisco, and San Diego.

Despite a bump in overall inventory, competition remained fierce in November, with homes selling at a brisk pace of 71 days on average — five days faster than they sold last year at the same time.

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