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For homebuyers in early 2014, success hinges on understanding a key market dynamic: specific U.S. metros are experiencing intense competition due to a powerful combination of rapid population growth and critically low housing inventory. Homes in cities like Austin, Dallas, Denver, Houston, Portland, Raleigh, San Antonio, and Seattle are selling faster and with more stability than the national average, requiring buyers to adopt aggressive strategies.
This analysis, based on market data and industry assessment, outlines the forces behind these competitive markets and provides actionable advice for buyers navigating them.
The core driver of competition in these eight markets is a severe imbalance between supply and demand. Housing inventory—the number of homes listed for sale—had fallen to its lowest point in at least four years in each of these metros as of February 2014. When supply is constrained, even a slight increase in demand leads to significant price pressure and faster sales.
The data on market speed is telling. In February 2014, 37.9% of homes in these eight markets sold in less than two weeks, a notable increase from 30.7% the previous year. This pace far exceeded the 22.5% average across 27 major metro areas studied.
| Metro Area | Key Characteristic (Feb 2014) |
|---|---|
| Austin, TX | Among the fastest markets |
| Dallas, TX | Among the fastest markets |
| Denver, CO | Among the fastest markets |
| Houston, TX | Among the fastest markets |
| Portland, OR | Among the fastest markets |
| Raleigh, NC | Among the fastest markets |
| San Antonio, TX | Among the fastest markets |
| Seattle, WA | Among the fastest markets |
| Table: Markets experiencing exceptionally fast home sales in early 2014. |
Demand is fueled by strong population growth, which itself is driven by two primary factors: job opportunities and relative affordability.
According to U.S. Census data from July 2012 to July 2013, these eight markets were among the nation's fastest-growing, with population increases between 1.1% and 2.6%—significantly higher than the national average of 0.7%. This growth is largely attributed to net migration, meaning more people are moving in than out. Robust job growth, ranging from 2.3% to 4.5% in these areas compared to a 1.6% national average, is a major draw.
Beyond jobs, lifestyle and cost of living are significant pulls. A February 2014 survey of nearly 2,000 homebuyers found that those relocating to Denver, Portland, or Seattle cited lifestyle as the top reason. For those moving to North Carolina and Texas, jobs were the primary motivator, followed closely by a low cost of living.
The affordability is quantifiable. Our experience assessment found that over 45% of homes for sale in Raleigh, Houston, and Dallas were affordable on two median incomes. This stands in stark contrast to more expensive coastal markets like Los Angeles (12%) and San Francisco (7%).
Buyers entering these markets should be prepared to act decisively. Based on our experience assessment, success often requires moving beyond a standard offer.
The key takeaway is that preparation and a strategic approach are non-negotiable in high-demand markets. Understanding the local dynamics and being ready to compete aggressively from the start increases the likelihood of a successful purchase.
