According to recent data from Clear Capital, nationally, quarter-over-quarter home price growth has slowed slightly from 0.9% to 0.8%, but the aggregate measure disguises a growing regional divide.
For instance, Florida metros Jacksonville, Orlando and Tampa all experienced a boost in domestic migration from 2015 to 2016, which has contributed to double-digit, year-over-year (YoY) home price growth, as well as declining distressed saturation rates. With this leap, Jacksonville steps up to become the fastest-growing major metropolitan housing market in the country, with its quarter-over-quarter (QoQ) home price growth jumping to 2%.
The West region continues to pace the nation, with 1.2% QoQ growth, thanks to high levels of growth in the Pacific Northwest, the Sacramento valley and Arizona. Of the top 15 metros, nine are in the West region. San Jose has begun to see growth accelerate, entering the top 15, with 1.3% QoQ growth, despite a meager 3.7% growth rate since this time last year.
The Northeast, despite not having any metros in the top 15 and being the only region to experience a significant increase in distressed saturation (up to 14.3% from 13.9% last month), is not far behind, with 1% QoQ growth – an uptick from 0.9% since last month.
Although the summer selling season is beginning to heat up, growth in the South has begun to slow down, with QoQ gains of 0.6% (down from 0.8% last month). Memphis, which was the worst-performing market in terms of QoQ growth last month, is showing signs of life, jumping into the top 15, with 1.5% QoQ growth (up from -0.3% last month) and 9.1% YoY growth (up from 6.7% a month ago). Despite this impressive turnaround and the contributions of the Florida markets, the South region’s growth has been stalled by Virginia Beach, Va.; Baltimore; Houston; New Orleans; Louisville, Ky.; and Birmingham, Ala. – all of which have grown by less than 0.6% QoQ.
The Midwest remains the slowest-growing region in the nation, according to Clear Capital, with QoQ growth slowing from 0.6% to 0.5% last month. Nonetheless, Chicago has begun to heat up, jumping into the top three in terms of QoQ growth, at 1.7% (up from 1.5%). Chicago, despite having a declining population in 2016 and 20% distressed saturation, is one of only seven metros to achieve double-digit YoY growth. While Minneapolis has maintained its 1.3% QoQ growth from last month, Cleveland and Cincinnati have seen significant headwinds. Both of these metros had been experiencing strong QoQ growth last month, at 1.2%, but have slowed considerably to 0.8% and 0.6%, respectively. In particular, Cincinnati is showing warning signs, with distressed saturation increasing dramatically from 14.5% to 17.6% in the last month.