The U.S. home buying frenzy is spreading from the pricier coastal cities to areas into the South and Midwest, according to research Realtor.com published on Thursday.
Midland, Texas, a medium-sized city midway between Dallas and El Paso near the state’s western border, topped the list of the country’s hottest cities in May for the second month in a row. The rise of small-fry locales in the country’s center mark a shift from earlier this year when California cities dominated the index.
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"The California housing market has been hot for a long time—but may be too hot," said Javier Vivas, director of economic research. "Our May hotness index further confirms we’re seeing that as prices in California continue to soar, people are increasingly looking elsewhere." California’s more affordable cities, such as Sacramento, Riverdale and Stockton, have risen on the list, which did not break out the luxury market.
Realtor, which like Mansion Global, is also owned by News Corp, rates "hotness" on several metrics, such as the age of a city’s inventory—a sign of how quickly homes are selling—and price growth.
In May, homes in Midland, the hometown of former first lady Barbara Bush and onetime home of presidents George H.W. Bush and George W. Bush, has a median 28 days on the market, and listing prices increased 31% from a year ago to a median of $367,275, according to data from the site. The fast-paced market mirrored neighboring Odessa, Texas, which also made Realtor’s list at No. 17.
The second hottest market in the country in May was the Boston metro area, where homes were also listed for a median 28 days. Prices there have edged up 6% since May 2017 and now hover around $529,500.
The unstoppable San Francisco, which analysts at bank UBS have warned is in serious bubble territory, came in at No. 3, with homes on the market for a median of three weeks.
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Still, Midwest and Southern cities dominated the list overall. Columbus, Ohio, where homes are selling 15% faster than a year ago, came in at No. 4.
Demand is also threatening to overpower supply in Boise, Idaho; Buffalo and Rochester in western New York; Grand Rapids, Michigan; and Fort Wayne, Indiana.