With the New Year finally upon us, prospective buyers have been made aware of several changes that can be expected to impact the housing sector. New lending practices may make it increasingly difficult for buyers to acquire a property and both mortgage rates and home prices continue to rise. These conditions, in association with uncertainty, have forced many investors to retreat from the market. However, Forbes has acknowledged reason for optimism. 2014 may usher in a period of housing deals that are accompanied by less competition. More importantly, there are several cities that have been pegged for encouraging growth.
With so many questions heading into the New Year, Forbes wanted to reassure investors that the housing sector appears to be on a sustainable path to recovery. As a leading source for reliable business news and financial information, Forbes has compiled a list of cities where prices are still low, but have the potential for considerable growth.
To compile its list, Forbes partnered with Local Market Monitor, which tracks home prices and local economic factors in more than 300 housing markets. Cities were ranked based on housing markets still considered “undervalued” in prices and that offer some of the largest job growth in their economies.
The following metros represent Forbes’ Best Buy Cities for 2014:
1.) Fort Worth-Arlington, Texas
The median price of a home in this region currently sits at $168,383. At their current value, homes are considered to be approximately 20 percent below their actual value. More importantly, analysts familiar with the market predict these areas to increase by as much as 25% in the next three years.
2.) Dallas-Plano-Irving, Texas
Similar to that of the Fort Worth-Arlington areas, Dallas-Plano-Irving represent other Texas cities expected to increase in value. As of now, the median home price in these areas is $180,646. Prices are currently considered to be 12% below their actual value. If that wasn’t enough, experts predict the prices to increase 29% over the next three years.
3.) Charlotte-Gastonia-Concord, N.C. – S.C.
Homes in these areas are averaging $201,855 and are considered to be 15% below their actual value. As a result, experts predict a 24% increase over a three-year period.
4.) Nashville-Davidson-Murfreesboro-Franklin, Tennessee
The median home price in these Tennessee cities is $199,506, but experts a predicting an increase of at least 23% over the next three years. As they are now, the houses are considered to be 16% less than their actual value, representing a great time to buy for investors.
5.) Houston-Sugar Land-Baytown, Texas
Rounding out the top five Best Buy Cities for 2014 is another set of Texas metros. The cities of Houston-Sugar Land-Baytown are currently undervalued by approximately 13 percent. The median home price in these regions is $191,279. However, prices are expected to rise by as much as 24 percent.