5 of the Most Undervalued Housing Markets Right Now

  • As home prices rise, some are looking for homes outside of the traditional hotspots.
  • Home construction continues to lag behind demand, which means housing across the country is likely to continue rising in price.
  • Some markets present strong opportunities for new buyers interested in getting the most home for their dollar.
undervalued housing markets - 5 of the Most Undervalued Housing Markets Right Now

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As home prices continue to soar, undervalued housing markets are beginning to attract interest. Indeed, even as 30-year fixed-rate mortgages trend around their highest level in more than a decade, home prices still haven’t come down. While home prices are something of a rising tide, some boats certainly catch more wind than others. Undervalued housing markets represent opportunities to those interested in real estate but uninterested in paying the hefty markups many areas have become infamous for.

As mortgage rates are primed to continue climbing alongside interest rates, some believe a recession may be the only force capable of bringing down home prices. And importantly, home prices remain elevated for good reason: a lack of home supply. Home construction remains woefully behind the pent-up pandemic demand for housing. As a result, even as housing demand falls, which there is evidence of between falling mortgage applications and rising home sale cancellations, home prices have yet to see a drop.

Despite the general rise in prices, some markets within the U.S. are hidden gems in a sea of bloated real estate.

5 of the Most Undervalued Housing Markets Right Now

  1. The Dallas/Fort Worth area of Texas offers a solid bang for your buck, especially compared to its big-city counterparts. The city has a home-to-income ratio of 3.0, lower than Austin, San Francisco and other major metropolitan epicenters.
  2. Unlike its Phoenix counterpart, Tucson, Arizona has a median property value of just $261,046, with a notoriously young workforce.
  3. While much of Florida has seen real estate prices skyrocket, the tri-cities of Palm Bay, Melbourne and Titusville are well below their Miami and Orlando neighbors. The area has a price-to-income ratio of 2.9.
  4. Another hidden gem found in the Lone Star State comes in the form of San Antonio. Compared to the likes of Dallas and Houston, you can get more home for less by sticking in San-An. The area has a home price to family income ratio of 2.8 and a median home value of just $227,784.
  5. Topping the list is Spartanburg, South Carolina, with a price-to-income ratio of just 2.5. The area has a median home value of just $181,571, the cheapest locale considered by the National Association of Realtors’ “hidden gems.” From 2017-2020 the area also enjoyed the second-greatest population growth.

On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

With degrees in economics and journalism, Shrey Dua leverages his ample experience in media and reporting to contribute well-informed articles covering everything from financial regulation and the electric vehicle industry to the housing market and monetary policy. Shrey’s articles have featured in the likes of Morning Brew, Real Clear Markets, the Downline Podcast, and more.


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