As the year draws to a close, it’s time to gear up for the future, and the National Association of Realtors (NAR) is stepping forward with predictions for the most dynamic real estate markets of 2025.
This past Thursday, the NAR unveiled its list of the Top 10 Housing Hot Spots for 2025. The spotlight largely shines on areas in Appalachia, with cities across the Carolinas, Tennessee, and Indiana taking prominent spots on the list.
In addition to spotlighting up-and-coming markets, the NAR also forecasted that mortgage rates are expected to level off at around 6% in the coming year. This stability is anticipated to attract more homebuyers, with the NAR projecting a listing of 4.5 million existing homes in 2025. For context, the average 30-year mortgage rate was noted at 6.78% in November, according to the association.
While the inventory of houses might increase next year, affordability remains a challenge. The median price of an existing home is projected to hit approximately $410,700 by 2025.
Curious about which cities are poised for growth? Here’s a peek at the top 10 cities predicted to be the hottest housing markets for 2025.
Top 10 housing hot spots for 2025
The cities listed below are arranged in alphabetical order:
- Boston-Cambridge-Newton, Massachusetts and New Hampshire
- Charlotte-Concord-Gastonia, North Carolina and South Carolina
- Grand Rapids-Kentwood, Michigan
- Greenville-Anderson, South Carolina
- Hartford-East Hartford-Middletown, Connecticut
- Indianapolis-Carmel-Anderson, Indiana
- Kansas City, Missouri and Kansas
- Knoxville, Tennessee
- Phoenix-Mesa-Chandler, Arizona
- San Antonio-New Braunfels, Texas
How were these hot spots chosen?
The NAR selected these top housing markets by examining the following 10 economic, demographic, and housing indicators, comparing them against national averages:
- Fewer homeowners locked into their current properties
- Lower average mortgage rates
- Accelerated job growth
- Increased number of millennial renters poised to buy
- Higher net migration compared to population size
- Greater number of households approaching homebuying age within the next five years
- Increased volume of out-of-state movers
- More homeowners exceeding the typical homeownership tenure
- A higher number of starter homes
- Rapid appreciation of home prices
What are the mortgage rates in the 10 hot spots?
If you’re unable to view the chart in your browser, you can access it directly at public.flourish.studio/visualisation/20780837/.
This comprehensive analysis and prediction by the National Association of Realtors provide a clear picture of where the real estate market is heading, especially in terms of regional growth and home affordability as we look towards 2025.
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Passionate about analyzing economic markets, Alice M. Carter joined THE NORTHERN FORUM with a mission: to make financial concepts accessible to everyone. With over 10 years of experience in economic journalism, she specializes in global economic trends and US financial policies. She firmly believes that a better understanding of the economy is the key to a more informed future.
