Home prices are rising in warm-weather states.
Phoenix, Las Vegas, Sacramento, Austin and Miami were ranked the five cities with the biggest home-price increases as an influx of high-earning home buyers continue to flood the market, according to data from Redfin.
The median home-sale price in those cities is higher than the $377,000 national median, with the exception of Las Vegas, according to the data. And Phoenix, Austin and Sacramento are also among the five cities with the most significant home-price increases for the month of May. Buyers from cities like New York, San Francisco, Los Angeles, Washington, D.C. and Denver are where most home buyers are hailing from.
Austin saw home price sales jump 42.4% year-over-year in May to $470,000, the biggest increase of the 88 largest cities in the U.S., according to Redfin data. Phoenix saw a 33.3% increase to $400,000 with the second-largest increase in home price annually in the U.S.
In Las Vegas, home prices were up 18.4% to $355,000, while Miami, a haven for tech-titans who fled Silicon Valley during the height of the pandemic, saw a 24.3% increase to $409,000 year-over-year.
"People moving into Phoenix from California, Oregon, Washington and even the Midwest are flooding the market, depleting inventory and pushing up prices," Phoenix-based Redfin agent Vincent Shook said in a statement. "So many people can work remotely from anywhere in the country, so they started looking at Arizona versus a place like Los Angeles or Seattle and thinking, ‘why stay in such a high-priced market when I can get a larger home in Phoenix for a lower price?’
Shook said those buyers in particular have higher salaries and can afford to pay over the listing price, which is sending home sales more than the actual asking price.
Rents in big cities, meanwhile, continue to go down, even post-pandemic. The eight most expensive cities in the U.S., including New York and San Francisco, among others, have seen a 16.3% drop in rents since March 2020, according to apartment rental website Zumper. The average rent for a one-bedroom apartment in San Francisco for the month of May, for example, was down more than 21% and New York and Boston saw 14.2% and 11% declines, the Zumper data shows.
Fox Business reporter Brittany De Lea contributed to this report