Zillow predicts 2025's hottest real estate markets
Buffalo, N.Y., maintains its position as the top-ranked region, with Indianapolis, Ind., and Providence, R.I., each climbing two spots to secure the second and third positions, respectively. Hartford, Conn., saw a significant jump of 15 places to rank fourth, while Philadelphia, Pa., rose six spots to take fifth place. St. Louis, Mo., climbed nine positions to rank sixth, and Charlotte, N.C., remains steady at seventh. Kansas City, Mo., and Richmond, Va., made notable gains of 10 and 11 spots, respectively, landing in eighth and ninth, with Salt Lake City, Utah, surging 18 positions to round out the top 10.
Virginia Beach, Va., led the charge in the middle of the rankings with a 23-place leap to 13th, while Oklahoma City, Okla., and Birmingham, Ala., each climbed 21 spots to rank 17th and 20th. However, some regions experienced declines, such as Cincinnati, Ohio, and Columbus, Ohio, both dropping nine places to rank 11th and 12th, respectively, while Atlanta, Ga., fell 18 spots to 24th.
In the bottom half, Louisville, Ky., slipped 12 positions to rank 26th, whereas Phoenix, Ariz., rose eight places to 27th. Washington, D.C., climbed 11 spots to 28th, while Tampa, Fla., experienced a decline of 19 positions, settling at 29th. Las Vegas, Nev., faced the steepest drop, losing 23 places to rank 35th, whereas San Antonio, Texas, climbed 13 spots to 36th. Lastly, Memphis, Tenn., saw the most significant decline in the rankings, falling 30 places to rank 43rd, with New Orleans, La., remaining unchanged at 50th.
This year's hottest housing markets are spreading westward, marking a continued shift in America's centers of power and jobs.
Why it matters: Last year, the Rust Belt dominated Zillow's annual market ranking.
The big picture: Zillow's annual ranking forecasts the most competitive housing markets for buyers. Markets at the top of the list are largely "starved for housing inventory," the real estate platform shares with Axios.
These regions tend to be relatively affordable with strong job and wage growth.
The intrigue: Buffalo is No. 1 again, and several metros dropped significantly or fell off the list entirely between the 2024 and 2025 rankings, Zillow senior economist Orphe Divounguy tells Axios.
Hartford, Connecticut, and Richmond, Virginia, are the rising stars to watch in 2025. Sellers there have the upper hand as homes fly off the market at record speed.
Across most of the U.S., buyers and sellers are at somewhat of a stalemate, Divounguy says.
Meanwhile, San Francisco and Memphis are slipping. They fell 19 and 30 positions, respectively. In these markets, homes are already sitting on the market longer, and home values are expected to depreciate, according to Divounguy.
The bottom line: Affordability and inventory are the name of the game.