As home prices increase 15% year over year, listing prices are dropping in a select few metros across the country. Realtor.com’s latest list price data found the median home price hit $356,000 in January, a 15% annual increase. Despite these record-breaking price jumps, there are six metros experiencing price drops. In general, these areas are in the south, rely heavily on tourism or college sports, and have struggling local economies, says Realtor.com. In Destin, Fla., home prices have dropped a whopping 15.6%. It’s due to the dramatic drop in tourism to the area, but the median list price remains at $469,000.
2. Honolulu, HI
Median list price: $975,000
Median list price change: -12.2%
Hawaii is synonymous with tourism, which hasn't exactly been a good thing over the past year. In December, visitors entering the state plunged 75% compared with the same time a year ago, according to preliminary data from the Hawaii Tourism Authority. That drop has led to massive job losses in the leisure and hospitality sector. In the Honolulu area, unemployment has reached 8.1%—well above the national rate of 6.7%.
Many of the buyers who can afford Hawaii's high prices come from the U.S. mainland or overseas, predominantly from Japan. With the pandemic restrictions, they had a harder time seeing the properties in person, leading to the decline in prices.
But folks shouldn't count the Aloha state out just yet. Low mortgage rates and the desire for more space, along with the appeal of living in paradise, are still driving demand for single-family homes, says local real estate broker George Krischke, of Hawaii Living.
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