Buying a house is not easy or cheap, especially in today’s market.
But while it’s too soon to tell whether the housing market is going to favor buyers or sellers next year, some areas will offer more favorable market conditions than others, according to a new report by the National Association of Realtors.
The NAR identified 10 top metro areas as “housing hot spots” for 2025 based on a variety of economic, demographic and housing factors.
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“Important factors common among the top performing markets in 2025 include available inventory at affordable price points, a better chance of unlocking low mortgage rates, higher income growth for young adults and net migration into specific metro areas,” Lawrence Yun, NAR chief economist and senior vice president of research, said in a statement.
The top 10 ‘housing hot spots’
“2025 is expected to be a year of more opportunities” for both homebuyers and sellers, said Nadia Evangelou, senior economist and director of research at the NAR.
Four out of the NAR’s 10 “hot spots” are located in the South — although unlike other lists, none are in Florida. Another three hot spots are in the Midwest.
Here’s the full NAR list:
- Boston-Cambridge-Newton, Massachusetts-New Hampshire
- Charlotte-Concord-Gastonia, North Carolina-South Carolina
- Grand Rapids-Kentwood, Michigan
- Greenville-Anderson, South Carolina
- Hartford-East-Hartford-Middletown, Connecticut
- Indianapolis-Carmel-Anderson, Indiana
- Kansas City, Missouri-Kansas
- Knoxville, Tennessee
- Phoenix-Mesa-Chandler, Arizona
- San Antonio-New Braunfels, Texas
While the NAR did not rank the hot spots, the metro comprising Greenville and Anderson, South Carolina stands out, according to the report.
Factors like a positive financing environment, strong migration gains, better affordability for first-time buyers, strong job creation and home price appreciation highlight the area, said Evangelou. About 42% of properties in the area are starter homes.
‘Unprecedented times’
While “a lot of these areas have been growing in recent years,” it’s important to remember that “we could potentially be walking into some pretty unprecedented times in 2025 and beyond,” said Jacob Channel, senior economist at LendingTree.
President-elect Donald Trump has been vocal about enacting ideas such as mass deportations and tariffs on all imports, as well as ending the conservatorship of Fannie Mae and Freddie Mac, he said.
If enacted, such ideas could have domino-effects into housing affordability. Immigrants make up about a third, or 32.5%, of construction tradesmen, according to an analysis of 2023 Census data by the National Association of Home Builders.
Change in immigration policy could impact the sector’s labor force. What’s more, with a shortage of workers, wages might go up and be passed onto buyers through higher home prices, experts say.