Louisiana is a one-of-a-kind American state, filled with a blend of unique cultures. It is as vibrant and exciting a place as there is in the country, with a melting pot of French, African, and American cultures creating something entirely different. Known for its great music and food, it is a diverse part of the US south.
Real estate in Louisiana has always been on the more affordable side, with the average cost of a home far below the national average. However, Louisiana has also been impacted by the hectic real estate market. Across the country, home prices are rising as inventory struggles to keep up with heightened demand.
This is the case in Louisiana as well. While the cost of a home in the state remains far below the national average, these prices have been slowly creeping upwards, and 2021 marked a steep rise for several key markets.
We have officially moved past the end of winter, and across America, the real estate market will start heating up. Let’s look at the current state of the market in Louisiana as we move towards spring.
New Orleans’ Real Estate Trends
New Orleans is Louisiana’s most populous city, a major metropolis home to over a million within the metro area. New Orleans is famed for its unique history, vibrant culture, and festive atmosphere that culminates in Mardi Gras every year. It has a reputation as being a highly desirable city to reside in.
Like many other markets in the United States, New Orleans is highly competitive right now. According to Redfin, the median sales price for a home in February 2022 was $347,855. This marked a 14.4% increase year-over-year, reflecting significant growth within a short span. This is the continuation of a long-term trend in the city, as prices have been steadily climbing for years. Five years ago, the median home in New Orleans cost only $205,000.
Homes are spending less time on the market as well. The same Redfin report showed the median days on the market for a New Orleans home was 28 in February 2022, down dramatically from 50 days on the market in February 2021. Despite this, the affordability of the city remains mostly intact.
According to a report from Norada, multiple offers for a home in New Orleans are quite rare, and some experts even consider it a buyer’s market. However, the rising home prices are significant, and the average home still sells for 2% over listing, making it a highly competitive market.
Other Key Areas' Trends
New Orleans isn’t the only major city in Louisiana. Let’s look at two of the other significant urban areas and see how their markets have performed and what to keep an eye out for going forward.
Baton Rouge is the second biggest city in Louisiana, an important urban center with a lot to offer. One of the best things that Baton Rouge has offered residents is great affordability. This is still the case, with homes sold for well below the national average; however, prices appear to be on the rise.
According to a report from Realtor.com, the median listing price of a home in Baton Rouge was $250,000 in February 2022. This was an 11.1% increase year-over-year and a new record high for the month. According to WBRZ2, sales are up 9% from 2021 at the same time and have hit a high since 2006. It is a hyper-competitive market, and while prices remain affordable, they are rising at a significant rate. With inventory in the area low, prices could climb throughout the year.
Metairie is a city just outside of the New Orleans metro area with the state’s fourth-highest population. It is also a rapidly growing real estate market. According to Redfin, the median sales price of a home in Metairie was $302,500, a 4.5% growth year-over-year. This level of growth isn’t astronomical, but it came after January when prices surged 11%. According to Rocket Homes, inventory is low in Metairie, with the homes available declining 11.9% from January to February.
Overall, prices are still in the mostly affordable range in Louisiana. While lack of inventory pushes these prices higher and higher, homes can still be found significantly cheaper than the national average across the state.
