KEY TAKEAWAYS
- Some buyers took a step back from the housing market this year as high mortgage rates and low inventory made housing prices unaffordable for many.
- According to Realtor.com’s 2025 National Housing Forecast, mortgage rates should drop gradually, and housing inventory should increase on average in the year ahead. However, that may not be the case in every city.
- Most of the 10 U.S. metros forecasted to have the top housing market activity in 2025 have a lower cost of living than the U.S. average, enticing more cost-conscious consumers.
Buyers struggled to find affordable housing this past year, but in 2025, the housing market should get more affordable—at least in some cities.
According to Realtor.com’s 2025 National Housing Forecast, mortgage rates should drop gradually, and housing inventory should increase on average in the year ahead. However, that may not be the case in every city. Realtor.com forecasts that some cities will have more housing activity next year than others.
“These markets—offering relatively lower-priced homes, more new and existing houses to choose from, and mortgage products designed to give buyers a leg up—could provide some would-be buyers a better chance at entering the market next year,” said Danielle Hale, chief economist at Realtor.com, in a statement.
| Realtor.com’s Forecast for the Top Housing Markets in 2025 | ||
|---|---|---|
| City | Expected 2025 Existing Home Sales Growth | Expected 2025 Existing Home Median Price Growth |
| 1. Colorado Springs, Colo. | 27.1% | 12.7% |
| 2. Miami, Fla. | 24.0% | 9.0% |
| 3. Virginia Beach, Va. | 23.4% | 6.6% |
| 4. El Paso, Texas | 19.3% | 8.4% |
| 5. Richmond, Va. | 21.6% | 6.1% |
| 6. Orlando, Fla. | 15.2% | 12.1% |
| 7. McAllen, Texas | 19.8% | 7.0% |
| 8. Pheonix, Ariz | 12.2% | 13.2% |
| 9. Atlanta, Ga. | 15.1% | 10.2% |
| 10. Greensboro, N.C. | 17.3% | 7.7% |
Why Do These Cities Top the List?
The top 10 metros, mainly located in the South and West, have seen significant new construction of single-family homes, Realtor.com said. More homes on the market provide options for buyers and decrease the price of homes by lessening competition. Homeowners are also predicted to list more homes for sale in 2025, which will further increase the number of options for buyers.
More home buyers are also seeking out lower living costs after inflation significantly pushed up prices for goods and services over the last few years. Seven of the 10 top markets for 2025 have a more affordable cost of living compared to average U.S. prices, Realtor.com said. The homes in the area also typically have lower price tags than the average metro area.
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