See the full rankings of the Emerging Real Estate Markets Index from WSJ / Realtor.com
Residential real estate is one of the most popular investments in the world. In the United States alone, the total value of owner-occupied real estate is approximately $ 32 trillion, almost as much as the value of the entire US stock market. And you can’t live in your stock portfolio.
To help buyers choose the best place to make this important investment, The Wall Street Journal worked with Realtor.com to rank housing markets that are expected to offer both a high return on investment and a great place to live. .
Why is Coeur D’Alene, Idaho, at the top of the list? Learn more about the city here.
While other market-to-market comparisons focus solely on housing metrics, the WSJ / Realtor.com Emerging Housing Markets Index also examines non-housing indicators to help identify places that are not just housing. good places to invest, but also where you are likely to profit alive. Initially, the index will be updated quarterly.
In order to identify the major emerging housing markets, The Wall Street Journal and Realtor.com examined data from the 300 most populous basic statistical areas, as measured by the US Census Bureau. (Note: The Wall Street Journal and Realtor.com are both owned by parent company News Corp.
The overall methodology explores two main areas: real estate markets (50%) and economic health (50%). These two areas include eight key indicators:
Real estate offer (16.6%)
Measures the relative scarcity of real estate for sale in one market compared to others based on the median number of days to market for real estate listings. Markets with a high supply score have relatively few days in the market compared to other regions. This relatively limited supply is likely to lead to higher house prices. In contrast, markets with a low supply score have more days on the market than other regions, indicating that relatively abundant supply will help ease pressure on house prices. (Source: Realtor.com. Updated monthly. Current data is as of March 2021.)
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Real estate demand (16.6%)
Measures the relative abundance of real estate demand in one market relative to other markets based on the average number of unique viewers per real estate ad. Markets with a high demand score have a relatively large number of unique viewers per household. This abundant demand from buyers is likely to lead to higher house prices. In contrast, markets with a low demand score have a smaller number of unique viewers per property ad, indicating that more limited demand from buyers will help reduce the upward pressure on house prices. (Source: Realtor.com. Updated monthly. Current data is as of March 2021.)
Median trend in real estate property prices (16.6%)
Measures recent home price performance relative to other markets based on typical asking prices for active realtor listings on realtor.com. (Source: Realtor.com. Updated monthly. Current data is as of March 2021.)
Measures the relative health of the local labor market. Data correspond to the estimated percentage of the non-institutional civilian population aged 16 and over who were not employed during the reference period. The seasonally adjusted series is used in the index. (Source: US Bureau of Labor Statistics. Updated monthly. Current data is as of February 2021.)
Measures the relative quality of employment in the region in terms of total wages. The data consist of median usual weekly earnings of full-time employees, before taxes and other deductions, including overtime, commissions or tips. Does not include self-employed workers. (Source: US Bureau of Labor Statistics. Update quarterly. Current data is for the second quarter of 2020.)
Regional price parities (7.1%)
Measures the cost of living and working in a metropolitan area. PPR consists of price level differences between metropolitan areas in a given year, expressed as a percentage of the overall national price level. The RPP covers all consumer goods and services, including housing rents. (Source: US Bureau of Economic Analysis. Updated annually. Current data is for 2019.)
ask WSJ about the hottest housing markets
- Join WSJ reporters Nicole Friedman and David Ewalt and Realtor.com Chief Economist Danielle Hale live this week as they discuss the latest real estate trends.
Measures the livability of an area in terms of available amenities, as represented by chain stores known for their daily shopping, a signal of consumer discretionary income. Data consists of the number of Starbucks,
Whole Foods and Trader Joe’s locations in the region, per capita. (Source: WSJ analysis of publicly available store locations. Updated monthly. Current data is as of February 2021.)
Measures quality of life in terms of the time residents have to spend each day getting to and from work. Data correspond to the average one-way commute time among workers aged 16 and over who did not work from home. (Source: US Census Bureau. Updated annually. Current data is for 2019.)
Foreign-born residents (7.1%)
Measures the economic health and diversity of a region represented by the portion of the population born outside the United States. Studies indicate a strong correlation between the economic vitality of a region and the number of foreign-born residents. (Source: US Census Bureau. Updated annually. Current data is for 2019.)
Small businesses (7.1%)
Measures the economic health and diversity of a region represented by small business activity. Data consists of the number of SBA 7 (a) loans granted per capita. (Source: US Small Business Administration. Update quarterly. Current data is for loans made in calendar year 2020.)
Each indicator is indexed to normalize the data, and a composite score is produced by adding these values for each geography. The sums are sorted to produce the final ranking. If two or more US metropolitan areas are tied in their final score, the Real Estate Demand Indicator is used to break the tie.
Write to David M. Ewalt at [email protected]
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