Real Estate Prices Are Soaring in One of America’s Poorest Cities

Among other things, Realtor.com’s February monthly housing report shows that sellers increased their activity for the month. Newly listed homes rose 4.2% above last year’s levels, marking the highest February activity since 2021. The median price of houses for sale slipped by less than 1% from last year’s figure to $412,000.

Prices in some cities among the 50 listed rose sharply. However, the only city with a double-digit percentage increase year over year was Cleveland at 14%. Cleveland is among the poorest cities in America. The median price of a home for sale was $241,725. Only in Detroit ($239,900) and Pittsburgh ($229,000) were those prices lower.

The median income in Cleveland is $39,187, about half the national figure. The poverty rate is a remarkably high 30.8%. Its population of 362,656 is down from 876,050 in 1970. Back then, the city was a manufacturing center, along with Detroit, Toledo, Pittsburgh, and Buffalo. In 1978, the city defaulted on federal loans. This was the first time this happened since the Great Depression.

In the most expensive cities based on median prices of houses for sales, prices are moving in the other direction. In February, prices in San Jose dropped 4.6% year over year to $1,304,500. San Jose has the highest price among the 50 cities studied. Prices in San Diego fell 4.7% to $949,995. In San Francisco, they declined 9.0% to $899,944.

The authors noted that the impact of government layoffs has not hit the housing market yet:

Federal workforce reductions could have ripple effects on housing markets with a high concentration of government employees, and the degree of the impact is likely to depend on the health of the private sector in these markets and its ability to provide new opportunities.

The American City That Lost 39% of Its Downtown Population in a Decade