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It’s no secret that the housing market has been extremely difficult this year. Rising inflation and interest rates have had a domino effect on the housing supply, leaving many buyers on the sidelines, with many homebuyers feeling “trapped” by the cheap mortgages they secured years ago. I’m doing it.
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And now, although interest rates are finally trending down, some markets are heating up as we head into 2025. In other words, demand is higher than inventory in these regions, driving up prices.
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Poughkeepsie, New York
Realtor.com recently identified a hot market by ranking the top 100 metros based on annual price growth and annual inventory growth. Poughkeepsie Metro is one of them.
“Buyers are attracted to the area’s natural beauty and relative affordability, snapping up available inventory and driving up prices,” said Hannah Jones, senior economic research analyst at Realtor.com. he said, adding that Poughkeepsie is no different.
According to Realtor.com, the median listing price in that metropolitan area is $399,000, a whopping 6.4% increase from last year.
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milwaukee
In Milwaukee, home prices are up 11.4% year-over-year, while inventory is up just 7.8%, lagging the national inventory growth of 34% for the same month, Jones said.
“This low-cost area has seen increased demand in recent years as buyers have shifted their focus to affordable markets that offer good employment opportunities and considerable lifestyle perks,” she added.
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cleveland
Jones said home prices in Cleveland are up 9.3% year-over-year and inventory is up 11.6%, also below national inventory growth for the same month.
“Like Milwaukee, Cleveland began to attract significant buyer attention as demand concentrated in lower-cost neighborhoods that offered attractive amenities and high costs,” Jones said.
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Austin, Texas
Dutch Mendenhall, co-founder of RADD Companies, said Austin has been a “hot name” for years, but will be “officially redlined” in 2025.
“House prices and rents are going up even more now that big tech companies are locating here,” he said, adding that while new construction is increasing, it’s not keeping up with the increase in good-paying jobs and talent. he added.
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He explained that low inventory and rapid population growth are pushing Austin into “overheating” territory.
“The technology-driven economy will drive real estate valuations higher in this market, and we expect bidding wars to continue for some time,” Mendenhall said.
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boise, idaho
Don’t let Boise’s size fool you, Mendenhall said. As he pointed out, it has been one of the most explosive housing markets in years, and 2025 will be no different.
“The large influx of remote workers, retirees, and Californians looking to lower costs and live outdoors has led to a bidding frenzy and soared prices beyond what could traditionally be covered by local incomes,” he said. He pointed out that inventories are so tight that new developments cannot be made quickly enough. .
Mendenhall added that Boise’s housing market will remain hot through 2025 if out-of-state migration remains strong.
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phoenix
Phoenix faces a similarly hot real estate market for several reasons.
First, as real estate investor and entrepreneur Rene Lacade explained, Phoenix’s population growth, driven by affordability compared to similar cities, is a major driver.
He also pointed out that a strong job market is creating a housing shortage, creating competition in the market and driving up prices.
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bend, oregon
Another city on the rise is Bend. Brian Smith, owner of Cedar Cash Home Buyers, said the city is one of the smaller cities that has been “on fire lately,” and it doesn’t look like it’s going to subside anytime soon.
Smith said Bend is the perfect combination of outdoor lifestyle and remote work, and is also a destination for retirees and second-home buyers.
“But here’s the problem: There aren’t enough homes to meet this demand,” he said, adding that this is causing bidding wars that drive prices even higher.
“Bend is definitely one of the smaller markets to watch because it’s heading into hotter territory,” he added.
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houston and dallas
Alex Blackwood, co-founder and CEO of Mogul, said the housing markets that are heating up heading into 2025 are Dallas and Houston.
“Dallas in particular will soon become the financial capital of the South, with hundreds of families moving there every day,” he said.
Regarding Houston, Blackwood said it is a growing housing market to watch as major conglomerates such as Chevron and Exxon move their headquarters to Houston, increasing job opportunities and housing demand in the area. said.
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This article originally appeared on GOBankingRates.com: 9 housing markets that will heat up heading into 2025
