This article has been updated with more recent data. For more information on the Buffalo real estate market, click here.
The Buffalo real estate market has made up ground since the recession, but not at the rate one would have hoped to see. Home prices have fallen below the national average, as appreciation rates for Buffalo real estate continue to drop. The second quarter witnessed year-over-year price growth swing into the negative, despite growing in the first quarter, as price trends in the last three years have undercut the steady post-recession price trend. However, the saving grace for the Buffalo real estate market continues to be home affordability, including a stronger-than-expected economy, which should proceed to improve in the second-half of 2016.
Buffalo, NY Real Estate Market Statistics:
The one-year appreciation rate for Buffalo real estate was -0.2 percent during the second quarter, in comparison to the national average of 4.9 percent. The three-year rate wasn’t any better, falling to -1.8 percent, compared to 17.8 percent from the national average. That said, the price trends in the last three years have hindered equity gains for Buffalo real estate, while owners continue to pay down principle.
Although home prices and equity returns are down, the Buffalo real estate market remains a viable choice for investment opportunities. Additionally, home prices remain low in comparison to total equity gains for Buffalo real estate. For those considering Buffalo real estate investments, the following provides a breakdown of appreciation rates in previous years:
- Homes purchased in the Buffalo, NY housing market one year ago have appreciated, on average, by $1,943. The national average was $14,963 over the same period.
- Homes purchased in the Buffalo, NY housing market three years ago have appreciated, on average, by $4,544. The national average was $46,878 over the same period.
- Homes purchased in the Buffalo, NY housing market five years ago have appreciated, on average, by $25,499. The national average was $82,353 over the same period.
- Homes purchased in the Buffalo, NY housing market seven years ago have appreciated, on average, by $26,874. The national average was $77,054 over the same period.
- Homes purchased in the Buffalo, NY housing market nine years ago have appreciated, on average, by $39,159. The national average was $31,126 over the same period.
Total equity gains for the Buffalo real estate market continue to fall short of the national average. Compared to the rest of the country, Buffalo real estate investors and homeowners have accrued a fraction of the total equity gains during the last seven years.
There are currently 864 properties in the Buffalo, New York area in some stage of foreclosure during August 2016. The number of Buffalo foreclosures in the month of August was the same as the previous month, according to RealtyTrac, including the same period in 2015. The number of REO properties in Buffalo were also unchanged from the previous month, including the same time last year.
Buffalo, NY: Real Estate Market Summary:
- Current Median Home Price: $129,600
- 1-Year Appreciation Rate: -0.2%
- 3-Year Appreciation Rate: -1.8%
- Unemployment Rate: 4.5%
- 1-Year Job Growth Rate: 0.8%
- Population: 258,959
- Median Household Income: $30,502
Buffalo, NY: Real Estate Market (2016) — Q2 Updates:
The median home price for Buffalo real estate was $129,600 during the second quarter, whereas the national average saw home prices reach $239,167. Additionally, one and three-year appreciation rates were in the negative for Buffalo, compared to the rest of the country which saw 4.9 percent and 17.8 percent rates respectively. For Buffalo real estate investors and homeowners, total equity gains aren’t at the level of the national average. Although Buffalo real estate investing has taken a hit in recent years, low prices have created potential investment opportunities.
Factors working in favor of the Buffalo real estate market so far in 2016 are home affordability, new housing construction, and the economy. The Buffalo housing market remains one of the more affordable in the nation, as the second quarter saw homeowners pay six percent of their income to mortgage payments, compared to the national average which paid 15.8 percent. Another positive for the Buffalo real estate market is new housing construction. The second quarter saw construction rise to 37 percent above the long-term average, while the number of single-family housing permits reached 29.9 percent, compared to the national average of 10.6 percent.
Lastly, the local economy in Buffalo continues to improve. The second quarter saw unemployment decrease from a year ago, falling from 5.4 percent to 4.5 percent during the second quarter, while the national average currently sits at 4.9 percent. On the flip side, employment has held up for Buffalo and is on an upward trend. The one-year job growth rate is currently 0.8 percent, compared to the rest of the country at 1.9 percent. The combination of improvements in the local economy, a surge in new housing construction, and continued affordable housing should bode for Buffalo real estate investing in coming months.
The Buffalo real estate market is forecasted to grow consistent with the national average in the second-half of 2016. According to the National Association of Realtors (NAR), the Buffalo real estate market is expected to see slightly lower price growth in the next 12 months in the U.S., with price expectations for Buffalo real estate predicted to grow by 3.3 percent in the second-half, compared to the national average of 3.6 percent. Despite tough conditions, the Buffalo real estate market should bounce back in the second-half of 2016.
