Cities come back: Home prices up 15% in 3 months

Low mortgage rates and, yes, remote work propel urban markets

National /
Feb.February 10, 2021 10:35 AM
Louisville, Kentucky (iStock/Photo illustration by Kevin Rebong for The Real Deal)

Louisville, Kentucky (iStock/Photo illustration by Kevin Rebong for The Real Deal)

Across the country, cities are rebounding.

Young, white-collar workers are taking advantage of record-low mortgage rates and remote work to move to more desirable urban areas.

Home prices in urban U.S. markets rose 15 percent in the three months through late January, according to Redfin. That’s a change from early in the pandemic, when price gains lagged those in the suburbs or even fell, Bloomberg reported.

“People are anticipating that now is a great time to buy,” Daryl Fairweather, chief economist at Redfin, told Bloomberg. “They’re not thinking about the short term. They’re looking forward to eating inside restaurants and going to concerts.”

In Louisville, Kentucky, values for properties in the more densely populated neighborhoods surged at twice the rate that they did in suburbs over the past three months. Detroit saw urban prices shoot up 43 percent. And in Baltimore, prices jumped 34 percent, compared with just 10 percent in outer areas.

Still, the most expensive areas, like Manhattan and San Francisco, are outliers. Cramped spaces and still sky-high prices, along with a lack of available amenities, have deterred buyers from rushing in.

[Bloomberg] — Sasha Jones





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