Kate Woodruff has been a real estate agent in upstate New York for many years, but in 2019, she started noticing something different about home prices — particularly in Syracuse.
Median home sale prices began climbing slowly that year and they haven't cooled off, Woodruff said in an interview. She said the number of available homes for sale in Syracuse has shrunk, and that has forced house hunters in the area to rethink their strategy for buying a home.
“My advice for my buyers now is, most of the time, homes are going to be on the market for seven days, maybe, so you need to put forth your best offer,” Woodruff said. “You need to be ready with a prequalification [for a mortgage loan] in hand.”
Syracuse is a market experiencing some of the fastest house price growth in the United States, according to a National Association of Realtors analysis released Thursday. The city of about 145,000 people and its suburbs, along with 87% of 226 metropolitan areas the trade group tracks across the United States, all saw their home prices increase during the third quarter.
The price hikes were a slight drop from 89% of markets that grew in the prior quarter and came as interest rates on 30-year home loans swung between 6.08% and 6.95%, NAR said.
To be sure, Syracuse home prices are far lower compared to the nation as a whole. The median price for single-family, existing homes in the upstate New York region was $262,000, up 13% from a year ago. Nationally, median prices grew 3.1% to $418,700 compared to a year ago, NAR said. A median home price is calculated by finding the middle of the range of how much houses cost in a certain metropolitan area.
Syracuse ranked third overall among regions across the county. In Racine, Wisconsin, for example, the median home price is now $310,000, up 13.7% from this time a year ago. That market posted the biggest growth, according to NAR data.
At No. 2 was Youngstown, Ohio, where the median price was up 13.1% to $171,000, NAR said.
Prices have climbed in Syracuse at a time when Micron Technology has announced plans to build a $100 billion semiconductor plant and economic development in the region is picking up. Woodruff said home prices in Syracuse have jumped so much that some of her past clients have postponed their home shopping for a year in hopes that mortgage rates or prices would fall. But even those who temporarily step aside are still seeing prices well beyond their means, she said.
"We have a double whammy here in central New York with our property taxes being so high," Woodruff said. "That cuts into a lot of people's affordability."
Home prices are climbing in a year where the spring and summer buying season underperformed what economists predicted. The Federal Reserve, in its battle to tame the nation's stubborn inflation, delayed adjustments to its benchmark interest rate, pushing mortgage rates beyond 7% at some points during April and May. The elevated rates spooked would-be homebuyers, many of whom have decided to remain renters.
Price drops
Thirty cities saw home price declines during the third quarter, according to NAR's data. The largest drop happened in Punta Gorda, Florida, where prices fell 6.5%. Sarasota, Florida, saw a price dip of 5.8% while Abilene, Texas, sank 4.8%.
Pittsfield, Massachusetts; Fort Myers, Florida; Chapel Hill, North Carolina; and San Antonio all saw home price decreases of about 4%, according to NAR's data.
Still, economists have noted that, as prices soar in most of the nation, it becomes even more financially difficult for average Americans to purchase a home.
“Housing affordability has been a challenge, but the worst appears to be over,” Lawrence Yun, chief economist for NAR, said in a statement. “Rising wages are outpacing home price increases. Despite some short-term swings, mortgage rates are set to stabilize below last year’s levels. More inventory is reaching the market and providing additional options for consumers.”
Racine, Youngstown and Syracuse are among a list of 10 cities that saw double-digit percent increases in home prices, NAR said. Peoria and Springfield, Illinois, as well as Burlington, Vermont, and Shreveport, Louisiana, experienced hikes of roughly 12%. Meanwhile, Rockford and Decatur, Illinois, as well as New London, Connecticut, saw increases of roughly 11%.
To be clear, those cities are nowhere near the most expensive places to buy a home. That title belongs to San Jose, California, where the median home price grew 2.7% to $1.9 million, according to NAR data. Anaheim, California, at a median of $1.4 million, and San Francisco, at $1.3 million, round out the top three most expensive markets in the nation.