Kansas City real estate market is currently in the top ten lists of the best housing markets for buyers. The list comes from NextAdvisor in partnership with TIME. Without a doubt, there are a handful of factors that lead to the increasing popularity of the property market in Kansas City. Without a doubt, it is necessary for anyone who is in the market for houses in the area needs to know various things about the market, especially in 2022 and further.
Of course, the matter of the Kansas City real estate market is more than just about buying and selling. It also includes the rental market for residential properties in the area. There have been some changes as well for the rental properties market from years ago. In many ways, this year could be the perfect time to search for one or two houses in Kansas City. Nevertheless, it is best to look at several things about the situation of the market.
Kansas City at a Glance
Kansas City is a city in the state of Missouri with fountains, jazz heritage, and barbecue as its famous things. Thus, it is reasonable for Kansas City to have its nickname of the City of Fountains. Believe it or not, that is one of the things that affect the attractiveness of this metro area. Currently, the population of the metro area of Kansas City is 1,711,000. That number will grow even further with the growing market of real estate.
Kansas City Population in Brief
Anything about the market for properties in Kansas City connects to the matter of the Kansas City metro population. As mentioned previously, 1,711,000 is the current population in the metro area of Kansas City. According to macrotrends, that number experienced an increase of 0.77% from the population of the area in 2021. Last year, the population was about 1,698,000. For the last four years, the increase is somewhat consistent. It indicates a top-notch atmosphere in many things about Kansas City, indeed.
Meanwhile, in the Greater Kansas City scope, the population is at the highest level. It comes as the result of the rapid growth of the suburban counties in the area. For example, Platte and Clay counties experienced a growth in the population of close to 20% in the last ten years. Overall, the metro area itself has had a population increase of 10.5% in ten years. According to the Mid-America Regional Council, there are 400,000 more people are expected to add to the current population.
The Cost of Living
Without a doubt, the cost of living in Kansas City KS is one of many reasons for the population growth in the area. According to NerdWallet, the living cost in Kansas City is approximately 40% less than in bigger urban areas such as Seattle, New York City, and San Francisco. That thing attracts more people to settle in Kansas City and adds up to the growth of the population. That lower level of living cost is not there without any reason, indeed.
The 10% lower than the national average tax burden total per capita in Kansas City is among the factors of its attractive living cost. The living cost is lower than the national average by about 3% of the margin. More importantly, Kansas City is also one of the best areas for education, job growth, business, and careers. With the shortest commuting time in the area, it is reasonable for many people to reside in the area of Kansas City.
Kansas City Real Estate Market
Looking at those things that are related to the market for residential houses in the Kansas City area, it is reasonable for the number to grow further. Nevertheless, it remains in the healthy area concerning the market itself. Apart from the growing population of Kansas City metro, there are suburban areas as well that remain capable of accommodating more residents in the future. What about the variety of crucial numbers in terms of the housing market in the area?
Unfortunately, the demand for residential properties in Kansas City remains higher than the available supply. The surprising element is that the majority of houses for sale will not be available anymore after about 24 days in the market. That fact comes from the Kansas City Regional Association of Realtors. Furthermore, almost all of those houses are sold for the original price on the listing. Therefore, it is reasonable for single-family homes to be the most attractive type in the area.
Another thing about Kansas City real estate, the cost of both materials and construction is on the rise. Therefore, resale homes are considered the most attractive option at the moment. It is considerably cheaper to look for a dwelling for sale in the market instead of building a new one from scratch. Plus, there is no need to wait for it to finish the construction before moving in. This particular thing adds up to the continuously increasing demand for single-family homes in Kansas City areas.
About the Zillow Home Value Index, the number experienced an increase of 17.8% from last year. As of November 2021, the ZHVI for houses in Kansas City is at $209,238. Believe it or not, that number has increased by almost 76% in the last five years. Imagine the projected increase for the ZHVI following the growing popularity in the area and increasing demand for houses. There is no other way but to go up. It is also among the reasons for realtors and investors to stick to Kansas City.
The next thing among the crucial matters of the market for houses in Kansas City is the median list price. A report from Realtor.com in November 2021 indicated that the median list price is $220,000. That leads to the $133 median listing price for every square foot of a residential housing unit in Kansas City. All of those numbers seem confusing and overwhelming. Nevertheless, they are among the key points to include consideration before looking for a house there.
Concerning the Kansas City housing market with those numbers, there are affordable options that remain for some people with a tight available budget. The Blue Hills area is the most affordable neighborhood in Kansas City. That fact comes from the median price in the area which sits at $122,000. It is close to half of the median listing price in the metro area. Therefore, it is the perfect neighborhood for anyone to look for affordable housing units and move into Kansas City.
On the other hand, the area that is considered the most expensive is South plaza. Believe it or not, the median listing price is $450,000. Without a doubt, it is the place for both high-end buyers and investors to find an agreement concerning buying and selling properties in the area of Kansas City. At least, those numbers are beneficial in providing a necessary background for anyone before deciding to reside in Kansas City.
Apart from the buying and selling of housing units in the area, the market for renters is also among the top ones. According to WalletHub, the low supply of single-family housing units for sale affect the increasing demand for the units for rent. A rather surprising fact on the real estate matter is that the metro area is the place with the second-largest decline in housing supply according to the Kansas City Business Journal.
Meanwhile, in the Kansas City rental market, the median rent price is $1,445 for a month. It applies to a house with 3 bedrooms. This data is according to the research from Zumper back in December 2021. The overall increase in rent price in Kansas City has increased about 18% from last year. Thus, it indicates that the rental market for single-family housing is as attractive as the one in the sale market.
Kansas City Real Estate Market Forecast
It is always necessary to check the past when thinking about purchasing a house in a specific area. Handy data comes from Freddie Mac which publishes the House Price Index every month. It helps investors, realtors, and buyers to check the previous pricing for houses in an area. Meanwhile, the FMHPI for Kansas City in 2016 was 136.5. On the other hand, the index changes to 210.2 in 2021. The growth of the real estate market in Kansas City is for real.
According to that data from Freddie Mac, the change in terms of the home price in Kansas City for 5 years is at the level of 54.0%. That leads to a 13.8% change in home prices annually. Therefore, the Kansas City area experiences at least a 1% monthly home prices change. What about the affordability level of Kansas City homes for sale if it continues to rise consistently? Of course, it comes to the matter of the overall living cost, quality of life, and job market situation.
Believe it or not, according to a report from Kiplinger, Kansas City has an affordability index of 2 from 10. It indicates that so far, it is one of the most affordable places to purchase a residential dwelling in the United States of America. The report also indicates that after the real estate cycle bottom in Kansas City in March 2012, the price increased by over 82%. Nevertheless, it remains a top-notch option at the moment to invest in a housing unit in Kansas City.
Kansas City Real Estate Market FAQ
Is It a Good Place to Invest in Kansas City?
So far, the competitiveness of the market leads to a positive answer for that particular question. The market remains healthy and active with a reasonable increase in price for housing units. More importantly, Kansas City is the largest city in the state of Missouri and is the sixth-largest in the Midwest part of the US. So, why bother thinking about investing in other places?
Is It a Good Place to Live?
Without a doubt, Kansas City is a top-notch choice of a place to settle. It is one of the least congested metro areas in the US. Therefore, there is no need to worry about spending a lot of time going to one place after another. More importantly, there are a lot of available jobs with low living costs. Those things are enough to think about the positive reasons for residing in Kansas City.
Does It Have Good Jobs for a Career?
Among the plenty of available job openings in Kansas City at the moment, there are top-notch ones as well. The city is a major hub for transportation with IT and finance sectors growing rapidly as well. Therefore, there are many jobs in those sectors to grow further. It is expected that the jobs within those fields will at least match or even surpass the national average in the US overall.
So far, the Kansas City real estate market is an active and attractive one. Numerous factors contribute to that fact including the low cost of living Kansas City KS. More importantly, the record-high job postings in Kansas City at the moment add to the attractiveness of the area to potential buyers. Despite the 128,000 jobs lost during the global pandemic, the unemployment rate in Kansas City, for now, is only 3.0% according to the BLS.
Therefore, it is reasonable for Zillow to predict that the hove values will continue to increase. It could reach a 10% increase in April 2023. Meanwhile, Zillow predicts that the value will increase at least 4% at the end of July 2022. Apart from all of those things, buying a house in Kansas City remains an attractive option. There is no need to hesitate on that at the moment because there are plenty of options to do with the house even after owning it.
Kansas City real estate market is a promising one for both buyers and sellers. Some areas remain available for further construction of housing units to enlarge the housing market as well. Therefore, it opens up a wide chance for different budget levels for anyone who wants to buy a residential housing unit and live there. Nevertheless, it is always necessary to expect a significant increase in terms of the price at the end of 2022.