Home Prices Are Rising Fast in These 20 Cities — Here’s Why

Think twice before buying a house in these cities.
  • U.S. home prices have increased nearly 7 percent from March 2017 to March 2018. 
  • California is home to five of the top 20 cities where home prices are rising the most, proving that California real estate is getting expensive. 
  • The No. 2 city (San Jose, Calif.) where home prices are skyrocketing is also the No. 1 worst city for first-time homebuyers, according to a separate GOBankingRates study.

The U.S. housing market is pretty hot right now. Nationwide, home prices have climbed 6.5 percent over the past year from March 2017 to March 2018, according to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index.

However, home prices have increased at a much faster pace in several cities, a new GOBankingRates study found. Using median home list price data from Zillow for the 100 largest cities, the study pinpointed the 20 places where home prices have risen the most over the past year. It calculated both the dollar and percentage change from March 2017 to March 2018.

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The rise in prices is good news for sellers in these hot housing markets. But soaring prices might make homeownership out of reach for more people in these cities — especially millennials looking to purchase their first house.

Click on the map below to learn more about the U.S. cities with rising home prices:

Don’t Miss: Best and Worst States for First-Time Homebuyers

For buyers, it might be especially tough to find an affordable home in California. The study found that five of the 20 cities where home prices have risen most are in The Golden State. In the Bay Area and Southern California, growing economies, high incomes and housing shortages have fueled the rise in home prices.

Two other states in the West — Nevada and Washington — also have cities among the top 20 facing the biggest increases in home prices. But the West Coast isn’t alone as several of the cities where home prices are rising fast are on the East Coast. Three of those cities — Jersey City, N.J.; Newark, N.J.; and Yonkers, N.Y. — have seen prices increase with an influx of people moving there from nearby New York City, where home prices are even higher.

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It’s True: You Might Actually Be Able to Afford a Mansion in These 20 States

Surprisingly, four of the top 20 cities are in the Midwest — Evansville, Ind., and Indianapolis; Lincoln, Neb.; and Cincinnati. The price increases have been driven, in large part, by strong job markets and a shortage of homes for sale. However, the increases in these places pale in comparison to the jump in home prices in the West Coast and East Coast cities on the list. In the four Midwestern cities where home prices have jumped, your real estate dollars still go a lot further.

Here’s a look at the 20 cities where home prices are rising fast:

Rank City State March 2017 Median Home Prices March 2018 Median Home Prices Dollar Amount Change in Home Prices – March 2017-18 % Change in Home Prices – March 2017-208
1 Sunnyvale CA $1,200,000 $1,498,000 $298,000 24.8%
2 San Jose CA $799,950 $984,000 $184,050 23.0%
3 Irvine CA $888,000 $1,026,000 $138,000 15.5%
4 Seattle WA $619,950 $725,950 $106,000 17.1%
5 Jersey City NJ $435,000 $520,000 $85,000 19.5%
6 Glendale CA $749,000 $852,500 $103,500 13.8%
7 Fremont CA $899,900 $999,950 $100,050 11.1%
8 Evansville IN $109,500 $139,888 $30,388 27.8%
9 Pensacola FL $169,900 $210,500 $40,600 23.9%
10 Lincoln NE $209,000 $249,950 $40,950 19.6%
11 Spokane WA $182,700 $219,900 $37,200 20.4%
12 Reno NV $364,900 $420,000 $55,100 15.1%
13 Boston MA $677,000 $749,000 $72,000 10.6%
14 Hialeah FL $269,950 $315,000 $45,050 16.7%
15 Yonkers NY $225,000 $264,250 $39,250 17.4%
16 Cincinnati OH $159,500 $190,000 $30,500 19.1%
17 Pittsburgh PA $179,900 $212,000 $32,100 17.8%
18 North Las Vegas NV $214,900 $251,000 $36,100 16.8%
19 Newark NJ $166,000 $195,771 $29,771 17.9%
20 Indianapolis IN $125,900 $149,900 $24,000 19.1%

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Click through to see the average salary you need to afford a home in your state.

More on Real Estate

Methodology: GOBankingRates identified the 20 cities where home prices have risen most by sourcing median home list price data from Zillow, and calculating the dollar and percentage change in price in the 100 largest cities from March 2017 to March 2018.

About the Author

Cameron Huddleston

Cameron Huddleston is an award-winning journalist with more than 18 years of experience writing about personal finance. Her work has appeared in Kiplinger’s Personal Finance, Business Insider, Chicago Tribune, Fortune, MSN, USA Today and many more print and online publications. She also is the author of Mom and Dad, We Need to Talk: How to Have Essential Conversations With Your Parents About Their Finances. U.S. News & World Report named her one of the top personal finance experts to follow on Twitter, and AOL Daily Finance named her one of the top 20 personal finance influencers to follow on Twitter. She has appeared on CNBC, CNN, MSNBC and “Fox & Friends” and has been a guest on ABC News Radio, Wall Street Journal Radio, NPR, WTOP in Washington, D.C., KGO in San Francisco and other personal finance radio shows nationwide. She also has been interviewed and quoted as an expert in The New York Times, Chicago Tribune, Forbes, MarketWatch and more. She has an MA in economic journalism from American University and BA in journalism and Russian studies from Washington & Lee University.

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Home Prices Are Rising Fast in These 20 Cities — Here’s Why
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