Top housing markets of 2025 revealed in new study
2025 U.S. real estate predictions
Zillow predicted a more active market with additional inventory for 2025, giving buyers more room to negotiate. However, homebuyers should expect some turbulence with fluctuating mortgage rates, even as more homes become available. Alana Mann, President of The Statesman Group of Companies, joined LiveNOW from FOX to discuss.
While nationwide home sales are expected to edge just slightly higher amid moderating home price growth in 2025, some markets across the country are projected to see much stronger growth in both sales and prices, according to a new study.
Researchers at Realtor.com used data on the housing market and overall economy to estimate the 2025 values for the 100 largest U.S. metropolitan areas by population size. The markets were then ranked by combined forecast growth in home prices and sales.
South, West stay on top
The survey found that the top markets for 2025 were exclusively in the South and West, with multiple markets from three states.
Texas (No. 4 El Paso and No. 7 McAllen), Florida (No. 2 Miami and No. 6 Orlando), and Virginia (No. 3 Virginia Beach and No. 5 Richmond) – rose to the top of the list.
Other states with markets in the top 10 included Colorado (No. 1 Colorado Springs), Arizona (No. 8 Phoenix), Georgia (No. 9 Atlanta) and North Carolina (No. 10 Greensboro).
Why are these markets in the top 10?
"From a technical standpoint, they make the list because we forecast these markets to be the leaders in home sales and price growth in 2025 across the 100 largest markets," Realtor.com said in their report.
Going beyond the technicalities, however, the data showed a correlation between the 2025 percentage increase in home sales across these markets and the 2025 home sales forecast relative to a market’s 2017–19 home sales average.
A "For Sale" sign at a residential home in Pinole, California, US, on Wednesday, Sept. 18, 2024. (Credit: David Paul Morris/Bloomberg via Getty Images)
"In simpler words, the markets we’re forecasting to lead the country in home sales in 2025 are markets that have better recovered to their pre-COVID-19 levels of home sales, and we expect them to hold that momentum in the year ahead," Realtor.com explained.
Although housing affordability is not better than average, the top markets do offer a somewhat lower cost of living than the national average. The most affordable market was McAllen, where the typical cost of necessities was about 13% below the national average.
Overall, 7 of the top 10 markets were more affordable than the U.S. in terms of cost of living.
Top housing markets in 2025
You can see the full list here.
Buyers have options in 2025
Nationwide, the recovery of housing inventory is well underway, with the number of homes for sale in November notching the highest mark since December 2019, according to the company.
"Still, this remains a glass half-empty or half-full story," Realtor.com added.
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Despite the significant gains to date, nationwide, the housing market still trails the 2017 to 2019 average for November by 20%.
Further, they found that there was notable regional variation in the inventory recovery, with the South and West generally far closer to pre-pandemic inventory levels than the Midwest and Northeast. They said this was undoubtedly a factor propelling home sales growth in the top markets, half of which had active listing counts above 2019 levels in the most recent data.
Realtor.com also noted that construction is an important part of the story. Eight of the top 10 metros have seen year-over-year growth in terms of single-family home permits issued year to date. Nationally, new-construction listings make up 17.3% of the listings on Realtor.com. All but two of the top 10 markets (Miami and Phoenix) are near this mark or better.