America’s 20 Hottest Real Estate Markets for July 2016

If our monthly report on the hottest real estate markets in America actually had its own thermostat, the glass would have cracked by now. A preliminary review of realtor.com®data for the month shows that smack-dab in the middle of the peak season for home buying and selling, we’re seeing the hottest July in a decade.

Yes, you read that right. And no, we’re not talking about the seemingly endless string of 90-degree days and nights afflicting much of the country.

“The best spring in a decade has transitioned into the hottest summer in a decade,” our chief economist, Jonathan Smoke, said in a statement. “Pent-up demand left over from tight supply for two years against the backdrop of mortgage rates remaining near three-year lows have encouraged buyers to keep active at a time when sales usually begin to decline.”

Watch: July’s Hottest Markets

 

Smoke looked at the number of days homes spend on the market, as a measure of the available supply, and the number of listing views on realtor.com, as a measure of demand by buyers.

When the final numbers for the month are in, Smoke expects to see that properties spent a median 68 days on market in July, which is one day faster than last year but three days slower than last month. This slowdown is normal as inventory reaches a peak for the year and sales begin to decline.

And although the median home price slipped 1% from June, to $251,000 for July, that’s still a record price for the month, and 7% higher than one year ago.

The inventory of homes for sale is still growing each month, although it should soon peak for the year. But the estimated 500,000 new listings for July will once again fail to keep up with the demand from buyers. Total inventory remains lower than one year ago.

Smoke’s analysis identified the top 20 hottest medium-to-large U.S. markets, where homes are selling fast and buyers are jostling to find a place and get their bids in. For the second month in a row, Vallejo—a modest city about 30 miles northeast of San Francisco—dominates the top spot. California can claim 12 of the 20 hottest markets, but six other states also represent: Texas, Colorado, Indiana, Ohio, Michigan, and Tennessee.

The biggest gainers this month were Yuba City, CA; Santa Cruz, CA; Colorado Springs, CO; and Columbus, OH, moving up 14, seven, six, and five spots respectively. Denver jumped four spots to crack the top five. Most markets include other towns in the greater metropolitan area; so Denver includes Aurora and Lakewood, and San Francisco includes Oakland and Hayward.

The hot list

20 Hottest Markets	July Rank	June Rank
Vallejo, CA	1	1
Dallas, TX	2	3
Denver, CO	3	7
San Francisco, CA	4	2
Stockton, CA	5	4
Columbus, OH	6	11
San Diego, CA	7	5
Santa Cruz, CA	8	15
Sacramento, CA	9	8
Santa Rosa, CA	10	6
Yuba City, CA	11	N/A
Modesto, CA	12	9
Detroit, MI	13	12
Fort Wayne, IN	14	10
San Jose, CA	15	13
Colorado Springs, CO	16	N/A
Fresno, CA	17	N/A
Eureka, CA	18	16
Nashville, TN	19	N/A
Ann Arbor, MI	20	17

Resource: http://www.realtor.com/