Most of the hot spots of the epidemic season have subsided, namely in Florida. Now, the Northeast is showing strong price appreciation, along with several Midwestern markets that have traditionally been the most affordable places to invest. As we head into 2025, below is a quick look at how prices look across the country according to the data we receive. released last month.
Florida’s West Coast Takes a Hit
The sun isn’t shining as brightly as it used to in the Sunshine State—at least not for landowners. After years of rising home prices, some of Florida’s booming cities have experienced a drop in home prices. Data from the National Association of Realtors (NAR) shows that Florida’s West Coast municipalities have it be beat especially hard.
Punta Gorda while the surrounding area saw a 6.5% price drop last quarter, bringing the average down to $350,000, the greatest of all down from 2011 North Port-Sarasota-Bradenton area decreased by 5.8%, pulling the median down to $485,000. Cape Coral-Fort Myers also decreased—by 3.7%, more than before decreases annually.
NAR chief economist Lawrence Yun told us Bloomberg that the Southeast, in general, suffers from the trifecta of economic factors: “excess inventory, high insurance costsand the construction of more houses in recent years.”
Tony Barrett, president of the Realtor Association of Sarasota and Manatee, feels that the extreme weather in recent months has not helped, delaying sales and hurting home buyer confidence. With the increase in housing construction and buyers become skittish, especially in the background hurricanes Helene and Milton this fall—the last hurricane happened just outside of Sarasota, taking lives and destroying homes across the country—Florida needs to rebuild emotionally. as well as physically.
However, some areas of the Sunbelt have suffered from declining prices due to the problems mentioned above. San Antonio-New Braunfels, Texasagain Durham-Chapel Hill, North Carolinathey all saw a drop in price year after year after that big a gain of more than 20% following the pandemic. Despite this, housing is still more expensive than before the pandemic and beyond the price range of many home buyers.
The Midwest and Northeast Boast Big Benefits
The Midwest, which has been reliably affordable for years, has boasted big gains in home prices. National Association of Realtors (NAR) data. shows that the fastest growth was moderate Racine, Wisconsinwhere home prices are up 13.7% from last year, and Youngstown-Warren-Boardman, Ohio in the region, where prices increased by 13.1%.
Both metro areas are affordable, with the median home price in Racine at $310,200 in the third quarter. In Youngstown, it was $171,100.
NAR data showed that Illinois had four cities posting double-digit gains:
Several low-cost cities in the Northeast posted big gains: Syracuse, New York (13%) and Norwich-New London, Connecticut (10.6%).
Data from GOBankingRates.com showed a few others:
Small towns in the Northeast have been hot for a while because of their low prices compared to the more expensive area citiessuch as Boston and New York, and the influx of new residents and jobs.
Recent gains in the Northeast may be a response to the exodus of citizens from the warmer Sunbelt states during the violence. This has decreased as the epidemic has subsided, companies are calling more people to return to the office.
Technology Investment Boosts Northeast Home Prices and Job Market
One of the biggest jobs and housing campaigns in the Northeast is technology, especially the billions of dollars the Biden administration has been investing in American chipmakers to take away profitable business from China. The government just announced the $825 million investment in the new area of semiconductor research and development e Albany, New York. Zillow shows that Albany’s house prices are currently up 6.7% year after year.
Syracuse Prepares for Economic Storm
Nearby, Syracuse prepares a an amazing transformation. In October 2022, Micron Technology, one of the largest manufacturers in the world, presented plans to build a 100 billion dollar factory in the middle i Syracuse place and employs tens of thousands of workers. Plans to link transport and housing are already underway.
A number of new businesses have opened in this area. Local officials estimate that the Micron facility will need an additional 40,000 residential units to accommodate the expected population growth of about 10,000 over the next three years. According to CoStar data, as of November, the average rent for a one-bedroom apartment in Syracuse is $1,156 a month, 26% less than the national average.
“There’s more demand for real estate than we’ve ever seen in my life” spreading from Clay south to Syracuse, Christopher Savage, director of sales at Cushman & Wakefield/Pyramid Brokerage, told CoStar News.
The Micron project is so large that it will affect housing in and around Syracuse and upstate New York.
“We want economic growth,” said Joe Driscoll, director of the I-81 project (the Interstate 81 viaduct is. being raised to welcome new developments) for the city of Syracuse and a former city council member, told CoStar News. “We want to see mixed-use development, we want to see coffee shops, we want to see restaurants, we want to see for sale, but with that balance of affordable housing, too. I don’t think so a lot of people realize what a $100 billion investment would look like. There’s a typhoon coming.”
Why Investing in the Northeast and Midwest Makes Sense
According to Warren Buffett BusinessWireBerkshire Hathaway, Northeast and Midwest owns the top real estate markets for 2025, with projected appreciation from 6.3% to 7.7%. The website says:
“These regions offer a combination of strong economies and affordable housing, which is attractive to buyers. Notably, two cities in Pennsylvania (Lancaster, Reading); Rochester (NY); Manchester (NH); and six midwestern cities (Akron & MansfieldOH; Rockford, IL; Grand Rapids, MI; Topeka, KS; Lafayette, IN) lead the pack.”
It’s worth noting that the forecast is only for 2025 and doesn’t include the tech boom that will hit upstate New York in a few years.
Final thoughts
You may you are forgiven for confused housing data in recent years. In the immediate aftermath of the pandemic, everyone talked about the Sunbelt and predicted the demise of the Northeast’s cities and towns as remote workers set off warm weather and cheap housing. Now, companies are looking to get back to work, and it seems the Northeast is heating up again.
The truth is that the majority of the US was happy to inform in 2024, at domestic prices growing nationally year-on-year by 3.4% since September. There is volatility in all markets, and investors invest for equity be careful look at each city’s economy, affordability, new developments and businesses on the way, and current assets.
While Florida and the Sunbelt may have it he dipped in the near future, it will be temporary as commodity prices and current house prices rebalance. New businesses have moved there to stay. However, the average investment in other Northeast cities shows that the rising house price may continue for a while.
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