OXFORD, Miss. – Rising interest rates and home prices, supply chain issues and limited inventory have combined to form a perfect storm of challenges for the nation’s housing market.
In many sought-after Mississippi cities such as Oxford, Hernando, Madison and Gulfport, these trends are consistent. In certain areas of the state, however, opportunities exist for those seeking affordable homes, said Charles Hilterbrand, instructional assistant professor of finance at the University of Mississippi and a real estate attorney.
“Mississippi is a low-cost state, compared to many others,” Hilterbrand said. “And our state offers many rural areas and smaller communities that have more opportunity for affordable housing.”
Nationally, the median home purchase price is $412,000, whereas Mississippi’s median price is $258,000 as of September – a 37% difference. Homes in smaller towns in the state, such as Water Valley, Grenada and Laurel, are appreciating slower due to less demand.
Remote and hybrid work options could give flexibility to Mississippians who are priced out of university towns, Memphis metro areas and coastal cities, Hilterbrand said.
“If you don’t want to live on the expensive coast, for example, you can find homes in other areas nearby,” he said. “A lot of companies are moving their people to areas that are more suitable for cost of living.”
Companies nationwide are more open to remote work than ever before. A May 2023 report by Littler Mendelson P.C. stated that more than 70% of employers have workforces operating on a hybrid work schedule.
Unfortunately, those interested in buying homes in hot Mississippi markets may not see a break anytime soon, Hilterbrand said.
“I imagine that we’ll have an extended period of higher interest rates,” he said. “We certainly won’t see 3% like we did before. We’re going to have to adjust.”
To that end, first-time homebuyers targeting these areas should develop a plan, Hilterbrand said.
“Go on a longer horizon – look well into the future for buying,” he said. “Instead of trying to get into a house next week, stay on the market longer if you can. Make your expectations realistic and discuss them with your real estate agent.”