The US housing market has been struggling due to high prices, limited inventory, and rising mortgage rates. However, a new report by the National Association of Realtors (NAR) identifies 10 metro areas that are poised for a better 2025.
These cities offer a favorable financing environment, with lower shares of locked-in homeowners and more opportunities for low mortgage rates. The top-performing markets share common factors such as affordable inventory, low mortgage rates, high income growth, and net migration into specific areas.
According to the NAR’s chief economist, Lawrence Yun, areas like Grand Rapids, Michigan; Indianapolis, Indiana; and Knoxville, Tennessee are among the top 10 housing hot spots for 2025. Other cities in the list include Charlotte, North Carolina; Boston-Cambridge-Newton, Massachusetts-New Hampshire; and Phoenix-Mesa-Chandler, Arizona.
The NAR predicts that mortgage rates will stabilize near 6% in 2025, bringing buyers back into the market. Inventory levels are also expected to improve due to new construction projects and more homeowners listing their properties.
Home prices are forecasted to increase by about 2%, reaching a $410,700 median existing-home price. However, this pace is slower than previous years. The NAR’s chief economist believes that home buyers will have more success next year, as the affordability challenges begin to ease.
The top 10 housing hot spots for 2025 are:
1. Boston-Cambridge-Newton, Massachusetts-New Hampshire
2. Charlotte-Concord-Gastonia, North Carolina-South Carolina
3. Grand Rapids-Kentwood, Michigan
4. Greenville-Anderson, South Carolina
5. Hartford-East-Hartford-Middletown, Connecticut
6. Indianapolis-Carmel-Anderson, Indiana
7. Kansas City, Missouri-Kansas
8. Knoxville, Tennessee
9. Phoenix-Mesa-Chandler, Arizona
10. San Antonio-New Braunfels, Texas
Source: https://www.woodtv.com/news/national/the-top-10-housing-hot-spots-for-2025-nar