Housing market — The United States’ economic environment has reached some of its lowest moments in recent history since 2022. The Federal Reserve’s main concern has been the continuance of inflation and the threat of a recession. Inflation’s influence has touched various industries, the bulk of which are still felt today.
After years of low interest rates, a worldwide pandemic, and the Federal Reserve’s efforts to control inflation, the country’s housing market has been among the most impacted. As a result, buyers and sellers are caught between a rock and a hard place.
Hard to find, harder to afford
In certain parts of the country, house prices have begun to level off or decrease, predicting higher mortgage rates. While homes are difficult to find, they are much more difficult to afford, according to the National Association of Realtors.
Several states are still faring better than others in terms of housing market instability, and corporations are keeping a close eye on the situation.
Because qualified personnel are in limited supply these days, firm leaders are looking for areas with growing housing markets that may provide potential employees with a prudent purchase and a comfortable home.
CNBC’s annual competitiveness study, America’s Top States for Business, analyzes the housing market using business-like criteria. In the 2023 approach, housing is utilized as a statistic in the economic category. The approach considers a variety of factors to determine whether states have healthy housing markets, including:
- Foreclosure rates
- Housing starts
- Price appreciation
In 2023, the technique integrated the Affordability Distribution Score of the National Association of Realtors as a statistic, which measures the cost of houses for sale across income levels.
A housing market with a score of one or above is regarded as affordable. Anything less than one implies that the market is less affordable due to a lack of listings in local buyers’ price range.
Affordability, rank, and appreciation in the housing market
Florida’s housing market is expanding. As more individuals come to Florida, prices have progressively risen. As a result, there has been an increase in home building throughout the city.
Although underwater mortgages are hard to come by, additional foreclosures may be a sign of stress, which would eventually affect affordability in America’s thriving housing market.
2023 economy rank: No.1
Homeowners in South Carolina witnessed significant price increases as the page turned to 2023. However, South Carolina’s housing market saw low prices, especially when compared to other states.
The affordability of South Carolina allows homebuilders to seize the moment with vigor. Despite the good news, rising foreclosures represent a problem.
2023 economy rank: No. 7
Maine, like the majority of states, has experienced a slowing economy. However, home purchasers have found something unique, which is driving up prices.
Maine home builders took the lead in 2022, with significant per capita activity, allowing affordability to remain relatively stable.
2023 economy rank: No. 38
People and companies in North Carolina are flocking to it in 2023. As a result of being voted the No. 1 State for Business in 2023, housing demand has skyrocketed.
Furthermore, North Carolina’s active building industry has contributed in meeting demand. However, it has not been enough to keep houses within reach of the growing population.
2023 economy rank: No.1
Despite its low cost of living, the Peach state has strong housing statistics, with double-digit appreciation. In any event, increasing foreclosures may indicate stress.
2023 economy rank: No. 4
Indiana is commonly seen as a paragon of stability. Despite growing house prices, the year began with high affordability. Furthermore, since the first quarter of 2023, when underwater mortgages were relatively low, foreclosures have been on the rise.
2023 economy rank: No. 9
The housing market in New Jersey began 2023 well-balanced, due to house builders meeting demand. Housing has contributed to New Jersey’s status as the most business-friendly state.
Even with minor underwater mortgages, a surge in foreclosures might create issues in the spring.
2023 economy rank: No. 19
Ohio has the most affordable homes in the country, according to the National Association of Realtors. It does, however, come at a price: less-than-stellar price appreciation. Property purchasers are increasingly taking advantage of homeowners’ distress as foreclosure rates and underwater debts climb.
2023 economy rank: No. 21
The state is among those with strong price increases and low foreclosure activity. The number of houses sold in Wisconsin declined by 20% in May, above the national average of 15.8%, according to Redfin. Although it may appear to have a negative impact, it is likely to help preserve high affordability.
2023 economy rank: No. 20
Home prices in Alabama are rising by double digits, according to the Federal Housing Finance Agency. Despite this negative result, housing remains affordable.
According to Attom Data Solutions, foreclosure activity is currently low, but a significant number of mortgages are projected to default.
2023 economy rank: No. 21