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10 U.S. Cities on Fire and How to Stay Cool in Them

What makes certain ZIP codes "hot" compared to others? As of 2015, the 10 have key aspects in common that attract homebuyers. Eight are located within metro areas with thriving economies, while the other two are within metro areas with growing economies.
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Photo courtesy of US Window & Door, Inc. in Carlsbad, CA

What makes certain ZIP codes in the US "hot" compared to others? As of 2015, the 10 listed below have key aspects in common that attract homebuyers. Eight are located within metro areas with thriving economies, while the other two are within metro areas with growing economies. Furthermore, the median income for Millennials in these areas is 50 percent higher than the national average. Here are four more factors these current top 10 ZIP codes have in common:

  • Affordability - Eight out of the 10 ZIP codes contain affordable housing. In three of (Worthington, Ohio; Novi, Mich.; and Crestwood, Mo.), people earning the median income can afford most of the homes on the market.
  • Lower unemployment - Eight of the 10 ZIP codes claim less than 5 percent unemployment.
  • Higher median income - The median income in the top 10 ZIP codes is 20 percent higher than the average for larger metro areas.
  • Higher overall income - A full third of the households in these ZIP codes make at least100,000 per year.
Photo courtesy of B Architecture Studio, Inc. in Melrose, MA

Where's the Fire?

Where are the hottest ZIP codes? Believe it or not, high-tech hot-spot Silicon Valley did not make the list. For the real action here are the 10 hottest ZIPs:
  1. Carlsbad, CA (92010) - Carlsbad has four ZIP codes, two of which are on the coast. 92010 is farther inland, making it more affordable. A home in Carlsbad can be had for less than600,000.
  2. Fargo, ND (58103) - 58103 is the fourth fastest-growing metro area in the nation. The median income in Fargo is growing about three times faster than the national average.
  3. Austin, TX (78729) - There are nearly 80 ZIP codes in Austin. 78729 is nestled close to high-tech powerhouses like Apple, Dell and IBM.
  4. Crestwood, MO (63126) - ZIP code 63216 has a homeownership rate of 84 percent. Its economy is growing and children from Crestwood attend Lindbergh Schools, a nationally recognized school district.
  5. San Antonio, TX (78247) - The second of three Texas ZIP codes on the list, 78247 is about one-third less expensive than the larger metro area and has a nice, suburban feel.
  6. Novi, MI (48375) - Novi's unemployment rate has dropped 30 percent since 2014. The median income is also triple that of Detroit's and 50 percent higher than Millennial households' nationwide.
  7. Plano, TX (75023) - Residents of Plano, the soon-to-be home of Toyota's U.S. operations, earn a minimum of100,000.00 per year. The average home listing is viewed about 1,200 times!
  8. Centennial, CO (80122) - Homes in this southern Denver suburb are generally snapped up within two weeks of their appearance on the market.
  9. Worthington, OH (43085) - One of the first planned communities in the United States, Worthington was founded more than 200 years ago. Listings are viewed about 1,000 times a month.
  10. Melrose, MA (02176) - his Boston suburb is "a magnet for young professionals," according to Realtor.com. The typical price of a Melrose home is only about 5 percent higher than those listed in the greater Boston area.

Keeping Cool in a Hot Market

Avoiding overpaying in a hot market can be tricky, especially for first time buyers. Here are some tips to help you keep your cool:
  • Hire your own home inspector. The house may look perfect to you, but an inspector knows how to make sure you're not overpaying for a house that needs a lot of work.
  • Check out the school districts even if you don't have kids. The quality of schools can affect the quality of the neighborhood.
  • Take a homeowner friend along. It can be overwhelming to buy a home; having an experienced friend on your side can only help.
  • If you're handy with tools, don't look for "Mr. Perfect." Look for a house that has the potential to become what you want.
  • Look at comparable homes in the area and learn how much they're valued at.
  • Haggle. Most sellers price their homes at about5,000 over what they'll take.
  • Don't sign an exclusive contract with a realtor. This will leave you free to look at houses that might not be in the agent's "territory."
  • Stick to your budget. Don't let yourself be tempted into spending "just a few thousand more" no matter how nice the place looks.