2022 Cleveland Housing Trends
During these past couple of years, housing and real estate trends have been on everyone’s minds. Whether you’re buying or selling, knowing the market before diving in can be central to whether things turn out as planned. Ohio Probate Luxe Realtor is here to help, with industry insights and trends.
How Cleveland Housing Prices are Changing
Home style, proximity to family or reliable employment, general safety, and school districts are all traditional factors to consider when looking to buy a home. That said, price and location often hold the ace in what has come to feel like a pretty wild card game in recent years. Prices naturally vary from one place to another even within Cleveland city limits. 2021 data puts Cleveland in the lowest tier when it comes to pricing for a standard home, right around $151,382, well below the national average of $269,039.
This isn’t a new phenomenon––Ohio and Cleveland homes are generally on the lower end of national pricing. But what does feel new is that pricing is slowly trending upwards, stemming from a lack of available inventory and a large pool of potential buyers. And this doesn’t seem to be a trend that will change in the short term.
Granted, pricing was on an upward tick already, the sign of a long-awaited recovery from the ever-looming foreclosure crisis that rocked the city over a decade ago. But the latest numbers show this spike as a recent development. Local data sets show a continuous rise in home prices over the past two years in the Greater Cleveland area, seemingly unaffected by numbers of homes sold during the same time period.
Reasons behind the trends could be many, but oftentimes low interest rates combined with a desire for more space while spending more time at home were key contributing factors. Reduced or stalled construction during the pandemic is also part of the equation, meaning less options for folks looking to build or buy. Whatever is driving the rush, current prices are now rising to the point that previously slow or light months for home sales are topping what were historically the busiest months of spring and summer. So while pricing may still be somewhere below national averages, depending on location, they’re higher than normal for the area. We are seeing some signs of stabilization, and likely higher interest rates and inflation will contribute to a leveling off, but as for right now, prices are still moving uphill.
In the end, the buyer has to balance interest rates vs. total price, and oftentimes it’s best for them to strike while they’ll land the best deal, however that falls into trends or norms. With a relatively hot housing market in Cleveland right now, homes can get multiple offers above the asking price and be both available and snapped up on the same day. But because housing prices are still affordable, by national standards, the market is likely to remain robust. Being listed in Forbes’ top five housing markets to watch last year likely didn’t hurt either.
Vacancies in Cleveland
Another factor that is pushing up price is home vacancy rate––it’s on the decline. In fact it dropped 40% year over year between 2019 and 2020. That means that even though the 2020 census shows a decrease in population in Cleveland, occupied housing units in the city increased slightly. The increase was slight–less than 200–but in light of all the uncertainty in other segments, this number is important and sheds light on why prices have been on the rise. To put it simply, there is less availability, and we all know what happens when demand is high and supply is low.
Another important note is that this slight increase in occupied housing units coincides with a reduction of overall units in the city. Those two factors combined shrunk the vacancy rate by almost four full percentage points. Of course this data can be somewhat skewed by location, but overall, this is a dynamic shift. It’s still far higher in Cleveland proper than it is in Cuyahoga County in general, but the numbers tell a story.
Shifts in population, smaller families, and the steady development of large apartment complexes seem to be contributing factors. The demolition of vacant properties resulting from the 2008 housing crisis also plays a role–yes, available housing units technically decrease, but oftentimes buyers are more likely to rehabilitate or rebuild other existing homes or build new ones in the surrounding areas once blighted homes are removed.
How Cleveland’s Population is Shifting
Cleveland has been on a steady decline as far as population goes for some time now. But more recent numbers give evidence that this trend could be leveling off. The past 10 years saw a 6% drop in population, but at the same time that is the third lowest percentage in the past 70+ years. Yes, folks are generally having smaller families, but population decline has historically also been attributed to Ohioans moving out of the state.
When Clevelanders and Ohio residents move out of the Buckeye state, they’re often traveling south or somewhere out west. At the same time, tens of thousands of individuals from neighboring states are moving in. While it’s hard to track precisely how that affects Cleveland proper, there are reasons to feel that population drop is headed toward a plateau and to be hopeful about what lies in the city’s future.
Harness Housing Trends with the Help of an Expert
If you’re looking to buy during this current housing market, the process could turn out to be a head-spinner. Will Davis of Ohio Probate and Luxe Realtor has weathered the rises and falls of the Cleveland housing market, and he can help you navigate them too. Get in touch for pointers and expert advice on finding the right Cleveland property for you.