The biggest price gains last month took place in the most affordable metro areas. Redfin found that 18 of the 20 metro areas with the largest year-over-year price increases had prices below the national median, led in January by Memphis (median price $182,900, up 17.1 percent), Dayton, Ohio ($132,000, up 14.8 percent) and Rochester, N.Y. ($148,500, up 13.3 percent).
Of the 85 largest metro areas Redfin tracks, only three recorded a year-over-year decline in the median sale price: San Jose (-4.3 percent), Baton Rouge (-4.1 percent) and Greenville, S.C. (-1.4 percent). Nationwide, home sales increased 6.7 percent year-over-year in January, the sixth consecutive month of increases, but were down 1.1 percent from December on a seasonally-adjusted basis. The markets with the biggest increases in home sales from a year ago were North Port, Fla. (29.9 percent), Las Vegas (23.8 percent) and Anaheim (23.2 percent).
"Typically, we don't see this many buyers in January, but with mortgage rates at a three-year low, there are plenty of early-birds hoping to secure a home and lock in an affordable mortgage payment," said Redfin Chief Economist Daryl Fairweather. "Home sellers, on the other hand, see that the market is clearly heating up and have no reason to rush to list their homes or to make price cuts in order to secure a sale. Back in December, it wasn't clear if demand would pick up in the new year, so some sellers were willing to accept lower prices, which borrowed some demand from January and resulted in the slight dip in sales we're seeing now."