“With home prices soaring and remote working the new norm, Americans have been taking a hard look at where they live — and many have decided to move out of pricey coastal markets,” according to Bankrate.com analyst Jeff Ostrowski.
Bankrate recently measured the strength of housing markets in the 50 states and District of Columbia. Its Housing Heat Index shows how states’ real estate markets are faring in the pandemic-fueled housing boom, and how they might perform in the future.
To calculate the ranking, Bankrate analyzed six data points from the following sources:
- Annual home price appreciation: Federal Housing Finance Agency’s Home Price Index.
- Share of mortgages past due: Mortgage Bankers Association.
- Annual unemployment and job growth: U.S. Labor Department.
- Cost-of-living index: Center for Regional Economic Competitiveness.
- State-by-state tax burdens: Tax Foundation.
The index double-weighed home price appreciation, the metric that most clearly conveys a housing market’s desirability. It half-weighted cost of living and tax burden — home prices can soar despite those factors, but a new wave of remote work makes those factors more relevant than they were in the past.
All six metrics were then averaged for an overall reading on the Housing Heat Index. Lower scores are better.
See the gallery above for Bankrate’s best and worst housing markets.