The Golden State was not having a very golden year as former residents started fleeing for more affordable cities due to California’s skyhigh housing prices and cost of living. But now, California is creeping back, securing 10 out of the top 20 cities on realtor.com’s January list of the hottest metro areas of the month. With mortgage rates low, new tech job prospects popping up, and a slight post-holiday boost, potential homebuyers are willing to make their budgets work so that they can live in California. People did not stop wanting to live in the Bay Area—they just could not afford it. Still, the state has a long way to go if it wants to bring down housing costs and make sure its cities do not push away more residents who cannot keep up with the rising prices.
As we look back on the first month of 2020, it seems that the new year has indeed brought changes to the real estate market. An analysis of realtor.com® data for January shows that California markets are again buzzing with real estate activity, even as affordability continues to be a driving factor across the country.
California markets made up 10 of the top 20 metros in realtor.com's monthly list of the hottest real estate markets in America. The ranking is based on the number of listings viewed per market, and the number of days that a home takes to sell. In other words, it reflects the eagerness of buyers in searching for and snapping up homes.
Although California markets dominated the list for years, they started to drop in the rankings more recently as prices continued to rise and many would-be buyers started to look to less expensive areas. So January's top 20 is a reversal of this recent trend of California markets cooling off, notes realtor.com Chief Economist Danielle Hale.