Where To Buy: 5 Cities With the Best Home Appreciation Rates in 2024

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If the Federal Reserve continues to keep interest rates steady, it could improve housing affordability across the U.S. After rising to an average of 7.22% in May, the average 30-year fixed mortgage rate dropped to 6.87%.

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Mortgage experts don’t foresee rates dropping much further unless the Fed reduces the prime rate, Forbes reported. However, some experts expect a decline in the third quarter.

If that occurs, housing prices could rise even faster than expected. Right now, according to data from Zillow reported by SparkRental.com, homes have not been appreciating as fast in 2024 as they did last year.

What are the hottest cities to buy a home right now if you’re looking to build equity quickly or flip an investment property at a profit?

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Oxford, Mississippi

Homes in Oxford, Mississippi, are appreciating at a rate of 14.87%, the highest in the country. The average home value is $344,856, according to Zillow. Ark7.com lists Oxford, along with cities like Jackson and Gulfport, as a good place to invest in rental properties and buy homes expecting long-term capital growth.

Dodge City, Kansas

Home prices in Dodge City, Kansas, are appreciating almost as rapidly as they are in Mississippi, with an increase of 14.68% in the past year. The average price of a home is just over $205,000, much lower than Oxford. This makes the city ideal for first-time homebuyers or investors looking for value properties. According to Zillow, housing prices have nearly doubled in Dodge City since 2016.

Great Bend, Kansas

Less than 100 miles from Dodge City, Great Bend, Kansas, also presents a tremendous value for real estate investors and other buyers. Homes in Great Bend have appreciated by 12.98% in the past year, reaching a median value of $153,583 in May 2024.

This small metro area has a cost of living 30% lower than the national average, and industries centered around agriculture and manufacturing, according to BestPlaces.net.

Statesboro, Georgia

Home prices in Statesboro, Georgia, grew 12.98% as of the 2nd quarter 2024. This Georgia city, southeast of Atlanta and Northwest of Savannah, is a blossoming college town, home to Georgia Southern University. This makes it a great place for investors looking to rent housing to students.

In spite of rapid property appreciation, homes are selling for lower than their listing prices, with the median sale price of $237,650. The median list price as of April 2024 was $304,900, according to Zillow. Consider Statesboro if you’re looking for an excellent deal on a property that’s likely to appreciate in a growing metro area.

Hartford, Connecticut

The only northeastern city on this list is Hartford, and homes are appreciating at a rate of 12.90%. The average home value in Hartford is $174,123, according to Zillow. Home prices vary widely depending on the neighborhood you choose, so if you want to invest in property in Hartford, consider spending time in the city first. Homes in Asylum Hill have a median price of under $100,000, which is rarely seen in northeast real estate markets. But homes in West End, on the other hand, go for $337,657.

Observations

SparkRental.com noted that the greatest growth is in smaller cities rather than major metro areas. Last year, Boston and San Diego made the list of top five fastest appreciating cities. This year, except Hartford, cities showing the fastest home appreciation rates are in secondary or tertiary markets.

Also, with the exception of Hartford, the cities with the fastest appreciation rates are in the South or Midwest United States. None of the hottest markets are along the West Coast. In fact, West Coast cities didn’t show appreciate higher than roughly 10% based on SparkRental’s heat map. Given the high cost of housing in California, if you’re looking to profit from an investment home, you’ll want to avoid the left coast.

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This article originally appeared on GOBankingRates.com: Where To Buy: 5 Cities With the Best Home Appreciation Rates in 2024