In many U.S. cities, homes are getting more and more expensive. A variety of factors influence home prices. However, there is at least one universal principle that explains the nature of housing prices. "Housing is driven by supply and demand," said Chandler Crouch, founder and principal broker at Chandler Crouch Realtors.
Thriving business climates, domestic migrations, home inventories — all of these factors can impact supply and demand in housing, Crouch said. With these factors in mind, GOBankingRates surveyed the 100 most populous cities in the U.S. to identify which cities are experiencing the fastest increases in home prices. From the Bay Area to South Florida, here are 20 cities where home prices are skyrocketing, and where a real estate bubble might be coming next.
20. Saint Petersburg, Fla., Home Prices
- June 2017 Median List Price: $249,900
- June 2016 Median List Price: $219,500
- Year-Over-Year Change: 13.85%
Home prices in St. Petersburg rose by almost 14 percent from 2016 to 2017. Looking back over the last three years, house prices surged by almost 70 percent — from $149,000 in June 2014 to $249,900 in June 2017.
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19. Garland, Texas, Home Prices
- June 2017 Median List Price: $203,950
- June 2016 Median List Price: $178,000
- Year-Over-Year Change: 14.58%
Garland is part of the Dallas-Fort Worth metropolitan area, a region that's experiencing major developments in its housing market. Over the last three years, home prices in Garland increased by more than 45 percent, from a median list price of $139,900 in June 2014 to $203,950 in June 2017.
The whole Dallas housing market is doing well, but home sales in Garland are especially high. With a median sales price below $300,000, Garland's affordability lures people into buying homes. That affordability, though, won't last if demand keeps pushing the median list price up year-over-year.
18. Kansas City, Mo., Home Prices
- June 2017 Median List Price: $195,000
- June 2016 Median List Price: $169,900
- Year-Over-Year Change: 14.77%
High demand and low supply are driving house prices upward in Kansas City. According to the Kansas City Star, there are roughly 14 percent fewer homes on the market than there were a year ago. Home prices might be rising due to the number of businesses moving to town, notably Google and Sprint.
17. Las Vegas Home Prices
- June 2017 Median List Price: $269,900
- June 2016 Median List Price: $234,900
- Year-Over-Year Change: 14.9%
Looking at the median home price by city, Las Vegas experienced its biggest surge from 2014 to 2015, an increase of almost 18 percent, as the city recovered from the housing crash. However, the city's recovery has led to a housing shortage, according to the Las Vegas Review-Journal, which is, in turn, driving house prices up. Even in this seller's market, it's important to know how to negotiate for the lowest home price you can get.
16. Lexington, Ky., Home Prices
- June 2017 Median List Price: $246,162
- June 2016 Median List Price: $213,000
- Year-Over-Year Change: 15.57%
Over the last three years, house prices in Lexington rose by almost 37 percent, from the median price of $179,900 in June 2014. The number of monthly home sales peaked last year at 1,602, the highest amount in the last five years, according to Trulia.
15. Orlando, Fla., Home Prices
- June 2017 Median List Price: $264,900
- June 2016 Median List Price: $229,000
- Year-Over-Year Change: 15.68%
Like other cities, increasing demand and low available supply are forcing house prices higher and higher in Orlando. Available inventory dropped by 15 percent year-over-year, according to a report by the Orlando Regional Realtor Association.
14. Omaha, Neb., Home Prices
- June 2017 Median List Price: $226,000
- June 2016 Median List Price: $195,000
- Year-Over-Year Change: 15.9%
From June 2014 to June 2016, the median home price in Omaha grew by roughly 24 percent, but remained under $200,000. In 2017, Omaha's median list price surpassed that threshold, however, reaching an approximate median price of $209,000 in February, according to Zillow. It's not all bad news, though. Omaha is still one of the best places to stretch your paycheck.
13. Lincoln, Neb., Home Prices
- June 2017 Median List Price: $219,900
- June 2016 Median List Price: $189,000
- Year-Over-Year Change: 16.35%
Examining house price increases by city, Lincoln has experienced double-digit percentage growth. From June 2014 to June 2015, the median list price jumped 15 percent, and from June 2015 to June 2016 it rose by more than 12 percent.
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12. Cleveland Home Prices
- June 2017 Median List Price: $69,900
- June 2016 Median List Price: $59,900
- Year-Over-Year Change: 16.69%
Cleveland's median list price is still cheap at $69,900, well below the median U.S. price of $259,000. One of the chief culprits for increasing prices is the shortage of homes for sale. Available inventory has dropped by 23 percent from 2012 to 2017, according to data from Trulia.
11. North Las Vegas, Nev., Home Prices
- June 2017 Median List Price: $227,845
- June 2016 Median List Price: $195,000
- Year-Over-Year Change: 16.84%
The housing bubble of the early 2000s hit Las Vegas particularly hard. But home prices in North Las Vegas have recovered well. Since June 2014's median list price of $165,000, the median grew by more than 38 percent. It reached the $200,000 mark in September 2016, according to Zillow.
10. Indianapolis Home Prices
- June 2017 Median List Price: $145,950
- June 2016 Median List Price: $124,900
- Year-Over-Year Change: 16.85%
Home prices in Indianapolis didn't budge that much year-over-year from 2014 to 2016. But from June 2016 to June 2017, the median list price rose by almost 17 percent, a rate of increase that is greater than 90 percent of America's 100 largest cities. Thanks in part to affordable home prices, you need to make less money to live comfortably in Indianapolis than many other cities.
9. Fort Wayne, Ind., Home Prices
- June 2017 Median List Price: $145,000
- June 2016 Median List Price: $123,900
- Year-Over-Year Change: 17.03%
This Indiana town has a hot housing market, according to Realtor.com. Fort Wayne offers affordable home prices at costs of about $66 per square foot. Since last year, Fort Wayne's home prices increased 17 percent, but the city saw an even bigger jump in home prices from 2015 to 2016, when the median list price increased by 18 percent.
Real estate agents claim houses aren't sitting around long before they're bought. So long as inventory is low and demand high, Fort Wayne home prices could continue their 17 percent year-over-year rise.
8. Minneapolis Home Prices
- June 2017 Median List Price: $269,900
- June 2016 Median List Price: $230,000
- Year-Over-Year Change: 17.35%
Rising buyer demand and a significant housing inventory shortage is sending prices skyward in Minneapolis. Before the housing crash, more than 20,000 homes were available for sale, but in 2016 only 11,000 to 15,000 homes were available, according to the Minneapolis Star Tribune. Not surprisingly, since June 2014, the median home price in Minneapolis has increased $50,000.
7. Seattle Home Prices
- June 2017 Median List Price: $675,000
- June 2016 Median List Price: $575,000
- Year-Over-Year Change: 17.39%
Out of the top 20 cities in this study, Seattle has the some of highest home prices in the U.S. Its June 2017 median list price of $675,000 trails only New York's median price of $825,000. And since June 2014, the median home price jumped by 50 percent.
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6. New York Home Prices
- June 2017 Median List Price: $825,000
- June 2016 Median List Price: $700,000
- Year-Over-Year Change: 17.86%
In last year's study, New York ranked No. 2. It might have dropped a few places, but that doesn't make its price increases any less significant. Though the median list price rose more from June 2015 to June 2016 — approximately 19.7 percent — the year-over-year growth from June 2016 to 2017 is still almost 18 percent. Use these survival tips to help you live well in an expensive city like New York.
5. Knoxville, Tenn., Home Prices
- June 2017 Median List Price: $198,900
- June 2016 Median List Price: $167,000
- Year-Over-Year Change: 19.1%
Tennessee is no stranger to booming housing markets. In fact, Nashville's housing market is getting so hot that it is driving up the cost of living and making affordable living more difficult.
In Knoxville, year-over-year increases in home prices have beaten the previous year. From June 2014 to June 2015, the median list price grew by 7.2 percent, from June 2015 to 2016 by 11.4 percent and from June 2016 to 2017, by just over 19 percent. At the same time, the available inventory of homes has dropped by almost 30 percent from 2012 to 2017.
4. Cincinnati Home Prices
- June 2017 Median List Price: $180,000
- June 2016 Median List Price: $149,250
- Year-Over-Year Change: 20.6%
Cleveland isn't the only major market in Ohio to see record growth in house prices. Comparing house price increases by city, Cincinnati's year-over-year change is much more impressive than Cleveland's. According to the Cincinnati Area Board of Realtors, Cincinnati home prices increased for the 13th month in a row as of June 2017. However, despite rising home prices, it can still be a smart financial move to buy a home.
3. Pensacola, Fla., Home Prices
- June 2017 Median List Price: $188,650
- June 2016 Median List Price: $155,900
- Year-Over-Year Change: 21.01%
For the second year in a row, Pensacola's median list price increased by double-digit percentages from June 2016 to June 2017. The increase in home prices is being felt in the rental market. Rents in Pensacola increased for five months in a row as of the end of June 2017, according to a report by Apartment List.
2. Atlanta Home Prices
- June 2017 Median List Price: $335,000
- June 2016 Median List Price: $269,000
- Year-Over-Year Change: 24.54%
When comparing house price increases by city, Atlanta hasn't just experienced big growth between 2016 to 2017. In the last three years, year-over-year increases have been among the largest in the U.S. From June 2014 to June 2017, the median list price rose more than 52 percent — from under $220,000 to $335,000.
1. Buffalo, N.Y., Home Prices
- June 2017 Median List Price: $84,900
- June 2016 Median List Price: $63,000
- Year-Over-Year Change: 34.76%
In our study of housing prices by city, Buffalo ranks No. 1, with a year-over-year increase of almost 35 percent. The rise in home prices can be traced to a smoking-hot seller's market. WIVB News 4 in Buffalo reported that houses are flying off the market and fueling bidding wars.
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Methodology: Using data from Zillow.com, GOBankingRates filtered median home listing prices by percentage change year-over-year, June 2016 to June 2017, from the highest percent change to lowest percent change of the 100 largest cities in the U.S. by population.