The best cities to buy a home right now
April 13, 2012
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Buying a home is not a decision to be taken lightly. Personal finance gurus warn against purchasing unless you plan to keep it for a minimum of five years and, since the housing bubble burst, many say it’s best to buy only if it fits your lifestyle – not your investing portfolio.
For first-time home buyers shopping for a permanent, full-time residence, it’s advice to heed. But say you do simply want a place to park some of your hard-earned money, perhaps a fixer-upper you could occupy for a few years or maybe a house you believe you could rent out right away and easily oversee?
See full story: The Best Cities To Buy A Home Right Now 
So you have cash or financing to make a purchase, you’re aware of the responsibilities that come with homeownership, and despite the woes continuing to hinder a full-on housing market recovery, you believe in brick and mortar investments. Now comes the tricky part: where to buy that house.
“A lot of what we read is national but you have to take housing down to the local level and look at the reasons why a market may be turning around, may be a good place to buy,” says Steve Berkowitz, chief executive of Realtor.com, a Campbell, Calif.-based home listing site.
To determine the best places to invest in a real estate purchase now, Realtor.com created a list which sorted through February housing and jobs data for 146 Metropolitan Areas and Metropolitan Divisions (cities and their neighboring suburbs) across the U.S. The company, which boasts millions of home listings filtered from over 900 Multiple Listing Services, looked at listing price data, sales data and inventory trends such as the amount of homes available in each market and number of days on market. Realtor.com also utilized the peak-to-trough home price index from Fiserv Case-Shiller, which tracks how much home prices have fallen in the past five years and can serve as an indicator of whether they have bottomed. Lastly, unemployment rates from the Bureau of Labor Statistics were factored into the rankings, since jobs (or lack thereof) are a leading indicator of housing demand.
If you want to buy low, foreclosure-riddled Tucson, Ariz., may be just the place. It ranks No. 1 on this list.
“In the case of Tucson, you are looking at foreclosures dropping back quite a bit coupled with a stable employment market,” says Berkowitz. The area has a 7.8% unemployment rate, a tad lower than the national average of 8.2%, helped by the presence of sizable employers in the recession-resistant education and government sectors, including the University of Arizona, Davis-Monthan Air Force Base and the U.S. Army Intelligence Center. All of this suggests Tucson’s housing market may be bottoming.
Here are the top 5 cities to buy a home:
5. Fort Worth, TX
Median List Price: $160,000 (up 8% y-o-y)
Inventory Level: 8,242 homes (down 26.5% y-o-y)
Median Days On Market: 79 days (down 19% y-o-y)
Price Drop From Peak: 4.7%
Unemployment Rate: 7.1%
4. Baltimore, MD
Median List Price: $239,500 (down 3% y-o-y)
Inventory Level: 13,053 homes (down 25.5% y-o-y)
Median Days On Market: 120 days (down 4% y-o-y)
Price Drop From Peak: 22.3%
Unemployment Rate: 7.5%
3. Kansas City, MO
Median List Price: $134,150 (up 0.3% y-o-y)
Inventory Level: 7,539 homes (down 21% y-o-y)
Median Days On Market: 103 days (down 15% y-o-y)
Price Drop From Peak: 8.8%
Unemployment Rate: 7.7%
2. Austin, TX
Median List Price: $229,500 (up 12% y-o-y)
Inventory Level: 8,329 homes for sale (down 19% y-o-y)
Median Days On Market: 77 (down 21% y-o-y)
Price Drop From Peak: 2.9%
Unemployment Rate: 6.1%
1. Tucson, AZ
Median List Price: $170,000 (up 3% y-o-y)
Inventory Level: 6,600 homes for sale (down 23% y-o-y)
Median Days On Market: 86 (down 12% y-o-y)
Price Drop From Peak: 45.1%
Unemployment Rate: 7.8%
For first-time home buyers shopping for a permanent, full-time residence, it’s advice to heed. But say you do simply want a place to park some of your hard-earned money, perhaps a fixer-upper you could occupy for a few years or maybe a house you believe you could rent out right away and easily oversee?
So you have cash or financing to make a purchase, you’re aware of the responsibilities that come with homeownership, and despite the woes continuing to hinder a full-on housing market recovery, you believe in brick and mortar investments. Now comes the tricky part: where to buy that house.
“A lot of what we read is national but you have to take housing down to the local level and look at the reasons why a market may be turning around, may be a good place to buy,” says Steve Berkowitz, chief executive of Realtor.com, a Campbell, Calif.-based home listing site.
To determine the best places to invest in a real estate purchase now, Realtor.com created a list which sorted through February housing and jobs data for 146 Metropolitan Areas and Metropolitan Divisions (cities and their neighboring suburbs) across the U.S. The company, which boasts millions of home listings filtered from over 900 Multiple Listing Services, looked at listing price data, sales data and inventory trends such as the amount of homes available in each market and number of days on market. Realtor.com also utilized the peak-to-trough home price index from Fiserv Case-Shiller, which tracks how much home prices have fallen in the past five years and can serve as an indicator of whether they have bottomed. Lastly, unemployment rates from the Bureau of Labor Statistics were factored into the rankings, since jobs (or lack thereof) are a leading indicator of housing demand.
If you want to buy low, foreclosure-riddled Tucson, Ariz., may be just the place. It ranks No. 1 on this list.
“In the case of Tucson, you are looking at foreclosures dropping back quite a bit coupled with a stable employment market,” says Berkowitz. The area has a 7.8% unemployment rate, a tad lower than the national average of 8.2%, helped by the presence of sizable employers in the recession-resistant education and government sectors, including the University of Arizona, Davis-Monthan Air Force Base and the U.S. Army Intelligence Center. All of this suggests Tucson’s housing market may be bottoming.
Here are the top 5 cities to buy a home:
5. Fort Worth, TX
 |
| Photo: iStock |
Median List Price: $160,000 (up 8% y-o-y)
Inventory Level: 8,242 homes (down 26.5% y-o-y)
Median Days On Market: 79 days (down 19% y-o-y)
Price Drop From Peak: 4.7%
Unemployment Rate: 7.1%
4. Baltimore, MD
 |
| Photo: Cameron Davidson/Getty Images |
Median List Price: $239,500 (down 3% y-o-y)
Inventory Level: 13,053 homes (down 25.5% y-o-y)
Median Days On Market: 120 days (down 4% y-o-y)
Price Drop From Peak: 22.3%
Unemployment Rate: 7.5%
3. Kansas City, MO
 |
| Photo: Thinkstock |
Median List Price: $134,150 (up 0.3% y-o-y)
Inventory Level: 7,539 homes (down 21% y-o-y)
Median Days On Market: 103 days (down 15% y-o-y)
Price Drop From Peak: 8.8%
Unemployment Rate: 7.7%
2. Austin, TX
 |
| Photo: Don Klumpp/Getty Images |
Median List Price: $229,500 (up 12% y-o-y)
Inventory Level: 8,329 homes for sale (down 19% y-o-y)
Median Days On Market: 77 (down 21% y-o-y)
Price Drop From Peak: 2.9%
Unemployment Rate: 6.1%
1. Tucson, AZ
 |
| Photo: Thinkstock |
Median List Price: $170,000 (up 3% y-o-y)
Inventory Level: 6,600 homes for sale (down 23% y-o-y)
Median Days On Market: 86 (down 12% y-o-y)
Price Drop From Peak: 45.1%
Unemployment Rate: 7.8%
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