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First Coast

Jacksonville could have nation's second-hottest housing market

A for-sale sign stands in the yard of a home in the Petworth neighborhood of Washington, D.C.
Michael A. McCoy for NPR
A for-sale sign stands in the yard of a home in the Petworth neighborhood of Washington, D.C.

Jacksonville could be the nation's second-hottest housing market in 2022, right behind Tampa Bay, according to a forecast released Tuesday.

Zillow, a real estate research firm, predicts that housing will continue to soar this year in all metropolitan areas, but places like Jacksonville and Tampa have the best prospects for rising home values, high job growth, fast-moving home sales and plentiful buyers.

Raleigh, San Antonio and Charlotte round out Zillow's Top 5 markets. Those places historically have been less sensitive to rising mortgage rates and a slowing stock market, two risk factors this year, Zillow said.

The coolest markets this year: New York, Milwaukee, San Francisco, Chicago and San Jose, California, according to Zillow. If interest rates rise, real estate will slow the most in San Diego, New Orleans, Washington, D.C., Los Angeles, San Jose and San Francisco, the report says.

Zillow based its forecast on home value appreciation, standardized listing days per home, non-farm employment and projected change in the number of owner households.

The forecast is good news for Jacksonville-area homeowners who could watch their property values rise even more in 2022. The Florida Realtors trade group says home values rose 22% in Greater Jacksonville over the past year, pushing the median sales price to $354,108 in November.

Buyers, on the other hand, could be in for another frustrating year in Northeast Florida and across the country. The lack of housing for sale and sky-high demand could make it hard for buyers to land a home.

"When demand is very high, even a decent number of homes on the market can still sell very quickly. ... And when new listings are quickly snatched up, it’s likely that means some buyers were left out," Zillow said.

Zillow does not expect much change in the factors that made 2021 a record year for the housing market. Those elements include relatively affordable interest rates, pandemic-related decisions on where people want to live and demographic shifts among aging millennials and retiring boomers.

Boomers will remain a force in the housing market for the next eight years, at the same time that younger millennials are hitting first-time home buying age. That will create sustained housing demand throughout the 2020s, Zillow says.