Record-high home prices have become the norm in most of the country over the past few years, leaving many would-be buyers priced out of the market while the rest battle it out for the few homes coming up for sale. These days, the bargains of the Great Recession are just a faded memory.
But the recovery hasn’t been even. While median home values have increased an average $50,000 nationally, some places have exceeded that—and four metropolitan areas still haven’t returned to their 2009 price peaks, according to a recent report from online financial services marketplace LendingTree.
The report looked at the 50 largest metros (which include cities and their surrounding suburbs) using the most recent U.S. Census Bureau data available, from 2009 through 2017.
So where have home prices not caught up yet? Home values in Hartford, CT, were down the most, falling about $11,800 from 2009 to reach $247,900 in 2017, according to the Lending Tree analysis. Median list prices have since risen a little bit to reach $259,950 as of Jan. 1, according to realtor.com® data.
“You’re seeing falling populations in [most of] these metros,” says Tendayi Kapfidze, chief economist of LendingTree. That’s because folks are going to places with hotter economies and more good-paying job opportunities. “That reduces demand for housing, which leads to lower prices.”
However, it’s important to note that the country is now experiencing a housing slowdown. Nationally, the rate of annual price appreciation is slowing—particularly in the priciest coastal markets—and sellers are being forced to reduce their list prices as more homes have hit the market.
That could affect home values going forward.
Where are home prices back up from the recession and then some?
On the other end of the spectrum is California. The state’s housing market has been on a tear over the past few years, thanks to all of those good-paying tech jobs and a severe shortage of homes.
Home values in Silicon Valley’s San Jose, CA, metro were up the most since 2009. They rose a whopping $319,400 to hit a median $957,700 in 2017, the Census data showed. (The median list price in the metro was $999,494 as of Jan. 1, according to realtor.com data.)
“There was a massive surge in employment, a massive surge in new wealth,” says Patrick Carlisle, chief market analyst at the real estate firm Compass. “And the construction of housing didn’t even come close to matching the increase [in housing demand].”
But since mid-2018, the market has “dramatically cooled,” he says. And it’s anyone’s guess where housing prices will head going forward.
“Incomes have not been keeping up with that home appreciation,” says Kapfidze. “That would suggest it’s not sustainable.”