Every state is unique when it comes to the real estate market. That’s why it’s critical to understand the market you live or operate in. Whether you’re renting, buying, or selling, it will impact many aspects of your life.
In this article, we’ll dive into the New Hampshire real estate market, including the key trends and metrics you need to know as a homeowner or investor. For more information about the housing market in New Hampshire, the New Hampshire Association of Realtors also provides valuable insights into the housing market trends, affordability measures, and the impact of interest rates in New Hampshire.
New Hampshire Housing Market Overview
New Hampshire, also known as the Granite State, is the fifth smallest state by area and tenth smallest by population. Despite its size, however, this New England destination attracts many tourists, investors, and home buyers each year. New Hampshire is an ideal destination for outdoor recreation lovers with its snowy mountains, deep forests, fall colors, and more than 800 lakes and ponds.
Tourism in New Hampshire has fortunately recovered since the pandemic, when the state faced worker shortages. Today, there are more jobs than job seekers in New Hampshire, which is better than the U.S.’s ratio.
New Hampshire’s economic recovery has coincided with a revival of its housing market. Ranked by one source as the #9 hottest real estate market of 2024, New Hampshire is one of the most in-demand markets in the U.S., despite the high cost of living in the Northeast in general. While Southern and Western cities like Austin and Denver are cooling, the Northeast states, including New Hampshire, have continued to see high competition and growth in the housing market.
The unfortunate side effect of this boom is that housing affordability has declined in New Hampshire. This is especially problematic in the Northeast compared to the rest of the nation, since there is very limited space and housing inventory combined with high population density. Low supply of residential housing is in part caused by high mortgage rates being faced by the entire country, as well as restrictive zoning. Rate cuts could encourage sellers to list their properties in New Hampshire, thus improving inventory and supply. However, new housing stock is still needed.
The New Hampshire housing market was expected to ramp up in the spring months, and it will likely be even more competitive into the summer. In fact, February of this year was the highest priced February in New Hampshire history, with the average price of single-family homes at $475,000.
Following from this broad overview, let’s dive into key New Hampshire housing market trends looking ahead into the rest of 2024.
New Hampshire Housing Market Trends
To understand the New Hampshire real estate market, it’s important to keep up with trends. Let’s look at some key ones in New Hampshire:
Note: These statistics are based on Redfin’s monthly housing data from April 2024.
Median Home Price
The median sale price for homes in New Hampshire is currently $506,300, up 12% since last year according to Refin’s monthly housing data from May 2024. However, keep in mind that this number represents an average, and does not tell the true story of variation within the state. For example, in Hanover, NH, the median home price is $876,000. There is no indication of home prices dropping in the New Hampshire housing market.
Number of Homes Sold in April 2024
1,509 homes sold in New Hampshire in May of 2024, up 9.8% according to the Redfin dataset. This metric gives us a good picture of the current sales volume in New Hampshire. However, keep in mind that this number might be inflated compared to other months since nationally speaking, sales usually peak during the spring and summer months and slow in the winter. In fact, the National Association of Realtors (NAR) predicts that in February and March alone, sales activity increases by as much as 34% and prices by 3%.
Median Days on Market (DOM)
Days on market (DOM) is a measure of the average length of time a home remains listed on the market before being put under contract. A lower DOM signals a highly competitive seller’s market with more pressure on buyers to make higher offers and remove contingencies. A higher DOM signals a buyer’s market as sales are slower and sellers have less leverage.
The current median days on market (DOM) in New Hampshire is 28 days. This means homes in New Hampshire spend less than a month on the market before becoming pending sales, indicating a competitive seller’s market with low inventory, high demand, and properties moving swiftly.
New Supply Statistics
Housing supply is increasing in New Hampshire, albeit slowly. On average, there were about 3.52 new residential construction permits per 1,000 people in New Hampshire in 2021. This suggests that there will be an increased housing inventory in New Hampshire soon, with construction resuming after pandemic lulls. Additionally, a significant percentage of homes are selling above list price, indicating a highly competitive housing market and impacting the overall state of the real estate market in New Hampshire. The rise of new listings, both from existing homeowners adjusting to new mortgage rates and from new construction homes, is also significantly impacting the housing market.
Property Tax Rate
The average property tax rate in New Hampshire is 1.93%, according to Rocket Mortgage. This places New Hampshire’s average property tax rate as the third highest nationwide. However, keep in mind that property taxes vary widely depending on the specific county of New Hampshire and the value of the home.
Foreclosure Rate in Q1 of 2024
In the first quarter of 2024, 1 in every 2,725homes experienced a foreclosure filing (according to recent data from ATTOM). Based on this data, New Hampshire’s foreclosure rate is lower compared to other states.
Hottest Local Markets in New Hampshire
New Hampshire features several competitive housing markets. Below are a few:
1. Manchester-Nashua
The Manchester-Nashua area recently ranked #1 out of 300 for hottest housing markets in the U.S. The median home price in the Manchester-Nasua metro area is $487,408 according to Zillow’s latest statistics. Homes in Manchester sell in just eight days on average, indicating a very competitive market. It has a historical reputation for being the heart of the Industrial Revolution, but today, Manchester is home to many opportunities in the arts as well as cultural events.
2. Concord
The state capital of New Hampshire is known for its historic charm and strong sense of community. Home to beautiful parks, trails, art, and cultural events, Concord attracts a steady stream of visitors, investors, and homeowners.The housing market in Concord is very competitive according to Redfin’s data, with homes selling in an average of 13 days at a median price of $350K, up almost 7% since this time last year.
3. Hanover
As mentioned above, Hanover is one of the most expensive neighborhoods in New Hampshire, with a median home price over $800K. The town is known especially for Dartmouth College, as well as historic charm and long-term safety, ideal for permanent residences.
Economic Factors Impacting the New Hampshire Housing Market
A holistic view of New Hampshire housing market requires a basic understanding of the main economic drivers affecting the market. Let’s look at a few critical ones below:
Mortgage Rates
High mortgage rates are a continuing challenge for would-be homeowners in the U.S. New Hampshire’s average rates for 30-year mortgages in June of 2024 are about the same as the national average at 7.05%. Higher interest rates deter borrowing and discourage those who already own homes from putting their homes on the market. Many homeowners report feeling “locked in” to their current homes, as it is unlikely they will secure a mortgage rates low as their current one on their next property. Prospective buyers in New Hampshire should monitor mortgage rates in the coming months for a better understanding of how they impact the housing market.
Inflation and Cost of Living
Mortgage rates are tied to inflation, another massive contributing factor to the affordability of housing and the state of housing markets in general. Inflation has increased the cost of living for many across the U.S., including in New Hampshire. This means fewer people can truly afford to limit housing costs to less than 30% of their monthly income.
Population Changes and Demographics
Population changes, employment trends, and migration each affect the housing market throughout the year. New Hampshire has had a positive net migration for the past few years, with more than 111,000 people moving to New Hampshire (mostly from other U.S. states but also from abroad) compared to only 93,000 leaving. In fact, the majority of New Hampshire’s residents were born in a state other than New Hampshire. In-migration tends to increase rents and demand for homes, so this is a trend to keep an eye on as more people look to New England to buy homes in the coming years.
New Hampshire Housing Market Forecast
Home prices in New Hampshire are expected to increase slightly throughout 2024. Year-over-year appreciation will likely continue, as demand is maintained, and housing inventory remains tight in the state. Over the long term, the state is expected to see substantial price increases and remain a strong and revitalized area for investment. Although analysts across the U.S. are keeping an eye out for signs of recession, the current market outlook for New Hampshire is generally positive. However, the New Hampshire Association of Realtors forecasts continued challenges with inventory scarcity and affordability, emphasizing the need for expanding housing supply to address these issues.
Likelihood of New Hampshire Housing Market Crash
A housing market crash in New Hampshire this year is unlikely. This is because low inventory, the potential for rate cuts, and reluctant sellers all contribute to increasing demand for homes in the state, which makes a crash unlikely to occur.
Forecast for The U.S. Housing Market
Now that we’ve looked at New Hampshire’s housing market, let’s zoom out a little bit. What about the U.S. housing market? What do you need to keep an eye on in the coming years?
The United States’s current median existing-home sale price is around $384,500 per the National Association of Realtors. The inventory, though, remains low. A balanced market typically has a 5-to-6-month supply, but the current figure is 2.9.
We’re currently in a seller’s market with buyers looking at continued rising house prices. The same trend can be seen with renters. Housing continues to appreciate, in general.
Dr. Lawrence Yun, Chief Economist and Senior Vice President of Research, National Association of Realtors, believes the housing market will appreciate 15 to 25% over the next five years. He thinks that the seller’s market will continue because housing inventory will remain low. In five years, however, he predicts a more balanced market, in which neither party has a built-in advantage. Thus, the market will shift to a case-by-case basis to determine what kinds of deals people can get.
Hybrid work also impacts the housing market. This shift in work culture means suburbia will continue to grow. States like Texas, the Carolinas, Tennessee, and Florida should see continual growth.
The number of single-family homes built decreased over the past couple years while the number of multi-family homes increased due to lower prices and a demand for affordable housing. Higher mortgage rates and inflation (affecting price of materials) were the main causes.
Lower income households continue to struggle in the current housing market. This trend appears likely to continue into the foreseeable future. Without enhanced supply or helpful subsidies, the outlook is that many Americans will still wrestle with housing affordability in the years to come.
New Hampshire Rental Market
The rental and buying market are obviously closely linked. When home prices fall, landlords are more likely to buy properties to rent out. Home prices and rental prices are correlated as well because a hot market means prices rise.
Rents were more unaffordable than ever in 2021 and 2022. In 2022, 22.4 million households paying rent said it was unaffordable, which is the highest that figure has ever been, according to a January report from the Joint Center for Housing Studies at Harvard University. The study found that half of all renters in the United States spent over 30% of their income on rent and utilities.
The markets cooled in 2023, though, due to new units and decelerating demand. But a serious problem persists: Rent increases are still outpacing income gains.
Moreover, high interest rates are keeping borrowing and transaction activity down. Over half the banks surveyed by the Federal Reserve reported that demand for multifamily loans decreased year-over-year.
The pandemic caused a housing disparity that isn’t going away anytime soon. Unaffordable housing is a serious issue across America. Whether high rents or low income is the main cause doesn’t change the fact that this problem is widespread.
This short summary leads directly into New Hampshire current rental market, with key metrics from Zillow:
New Hampshire Rental Market Key Trends
- Median rent: $2,183
- Month-over-month rent change: +$97
- Year-over-year rent change: +$61
- Available rentals: 1,109
Conclusion
The New Hampshire housing market in 2024 is marked by a blend of stability and growth, making it crucial for potential buyers and sellers to stay informed about market trends. Whether you’re looking to purchase a home soon or sell your property in New Hampshire, the macro- and micro- economic trends outlined above will affect your decision-making. Market dynamics like changes in home prices, inventory levels, and interest rates will continue to be critical for stakeholders in New Hampshire real estate.
