For the price of a home in LA, you could’ve bought a skyscraper in St. Louis

Real estate outlook: Buying a home in 2024

Is 2024 a good time to buy a house? New York City real estate expert and agent Frances Katzen explains.

LOS ANGELES - Should you shop for a home now or wait for potential drops in mortgage rates? Many home shoppers are facing this dilemma, especially as mortgage rates have risen this week, edging closer to 7%, with no signs of relief for the slow housing market.

Given the current chaotic market conditions, one might question the rationale behind purchasing a home. After all, for the price of a house in a city like Los Angeles, you could potentially acquire something as substantial as a 44-story office tower in St. Louis.

Indeed, it's true. One of St. Louis's tallest towers, which initially fetched $205 million in 2006, recently changed hands for approximately $3.6 million this week, as reported by CoStar News.

Boston-based Goldman Group now owns the former One AT&T Center, a 44-story high-rise spanning 1.46 million square feet. According to CoStar data, the tower's value plummeted from about $140 to $2.50 per square foot over 18 years.

File: One AT&T Center, in St. Louis, Missouri, seen on November 2, 2012. (Photo By Raymond Boyd/Michael Ochs Archives/Getty Images)

Meanwhile, last month, the median listing price for homes in Los Angeles stood at $1.2 million, marking a 7.8% year-over-year increase, according to Realtor.com.

In West Los Angeles, a single-family, 996-square-foot teardown on a 6,190-square-foot lot sold for $1.1 million in 2020.

Los Angeles is a large city, and while the average price is lower than the recent sale price of the former One AT&T Center, hundreds of homes in the "City of Angels" are selling for $3-million to $5-million.

The Wall Street Journal has turned its spotlight onto St. Louis' real estate scene, describing it as a "nightmare." Their latest examination highlights the city's challenges with vacant properties. Notably, the Railway Exchange Building, once a bustling hub in downtown St. Louis for over a century, now stands desolate and vacant.

View from Gateway Arch of Old St. Louis Courthouse, Gateway Arch, site of historic Dred Scott decision triggering Civil War, MO.

As the real estate market continues to astonish with its divergent values, the stark contrast between the price of a home in Los Angeles and a skyscraper in St. Louis is just the beginning.

Beyond U.S. borders, the disparity in real estate values becomes even more pronounced.

What else could you buy with that cash?

What about a chateau in France? With home prices in America soaring to astronomical heights, some buyers are turning their gaze elsewhere.

You could buy this 8-bedroom Neo-Gothic castle with 34.6 acres of land for $1.7 million.

Another French chateau, situated in Montluçon, a commune in central France along the river Cher, is currently listed for under $1 million.

Or you could buy a 48-acre farm in Wyoming which includes:

Hay shed/shop
3-bedroom home
2 barns with stalls
A pasture for your horses

What is the average cost of a home in the U.S.?

Real estate settlement: Impact for buyers & sellers

Real estate developer Uri Man shares insight to how the settlement is shaking up the entire housing market

Bankrate's most recent survey of large lenders indicates that the current monthly mortgage payment stands at approximately $2,063. This figure is calculated based on the U.S. Department of Housing and Urban Development's national median family income for 2023, which is $96,300, and the median price of an existing home sold in February, reported at $384,500 by the National Association of Realtors (NAR).

The average rate on a 15-year fixed mortgage has risen to 6.16% from 6.06% last week, compared to 5.54% a year ago.

According to a report by the Associated Press on Thursday, the national median sale price of previously owned homes surged by 44% between 2019 and 2023, rendering homeownership less attainable for many Americans due to higher mortgage rates.

Despite expectations of a slight moderation in mortgage rates later this year, most forecasts project the average rate for a 30-year home loan to remain above 6%.

Refinancing a home loan has also become more expensive this week, with borrowing costs for 15-year fixed-rate mortgages, commonly used for refinancing longer-term mortgages, increasing. Freddie Mac reported that the average rate rose to 6.16% from 6.06% last week, compared to 5.54% a year ago.

The Associated Press and FOX Business contributed to this story.