Home prices doubled in under 7 years in Cleveland

(NEXSTAR) – Stunned by skyrocketing home prices? You’re not alone.

In 68 of the largest U.S. cities the average price has more than doubled in less than 10 years, a recent study by Point2Homes found.

“A common home appreciation theory is that residential properties tend to double in value in about 10 years,” the study notes. “But this good news for investors spells bad news for buyers, considering that most of the country’s major cities had home prices double even faster than that.”

Recent buyers in Spokane, Tampa, and Buffalo, for instance, may look back wistfully to 2017 when the average price was less than half of what it is now.

As recently as 2019, homes in Detroit, where prices have doubled the quickest, were half what they are now, the study found.

Looking at home prices in recent years may be the most painful for new homeowners in Irvine, California, however, which was the most expensive housing market on the list, jumping from $750K to $1.5 million in seven years.

In terms of overall highest prices, eight of the top 10 most expensive U.S. cities in the fourth quarter of 2023 were in California, led by San Jose-Sunnyvale-Santa Clara ($1,750,300), San Francisco-Oakland-Hayward ($1,251,000), Salinas ($993,900) and San Diego-Carlsbad ($931,600), according to National Association of Realtors data.

See the top 20 cities when it comes to home prices doubling in the shortest amount of time:

In February, 2024 home prices across the country were up 6.4% year-over-year, according to Redfin, with an average sale price of $411,887.

Cleveland, Ohio led all metros in growth last year (25.5%), followed by Birmingham, Alabama (24.4%); Boca Raton, Florida (22.5%); Richmond, Virginia (19%); Fort Wayne, Indiana (18.6%); Dallas, Texas (16.9%); Miami Beach, Florida (16.7%); Cincinnati, Ohio (15.9%); Meridian, Idaho (15.6%); and Lexington-Fayette, Kentucky (15.5%).

“Homeowners have benefited from housing wealth accumulation. However, many homebuyers have been shocked at high housing costs, with a typical monthly mortgage payment rising from $1,000 three years ago to more than $2,000 last year,” said NAR Chief Economist Lawrence Yun.

Amid persistently high prices, prospective home buyers have at least one source of hope this year, thanks to a bombshell legal settlement.

In March, the National Association of Realtors announced that it had agreed to pay $418 million to settle lawsuits over commissions traditionally tacked onto the home-buying transaction.

The new rules also allow home buyers and sellers to negotiate lower agent commissions instead of the typical 5-6% of the sale that is currently split by brokers on both sides of the deal.

Changes to the rules will take effect in mid-July.