20 Hottest Housing Markets in America – January 2025

Ready to dive into the real estate scene of the new year? Based on a recent Realtor.com report, Manchester, New Hampshire, claims the top spot as America's Hottest Housing Market in January 2025. This means the demand for homes is incredibly high there while the number of available properties is low. Keep reading to learn more about what's driving this trend and which other cities made the top 20!

America's Hottest Housing Markets – January 2025

The Heat is On: Understanding the Hottest Markets

So, what exactly makes a housing market “hot”? It boils down to a few key factors:

• High Demand: Lots of people are looking to buy in these areas.
• Low Inventory: There aren't many homes available.
• Quick Sales: Homes don't stay on the market for long.
• Rising Prices: The combination of high demand and low supply usually pushes prices up.

When these elements come together, you've got a market that's sizzling! And right now, the Northeast and Midwest are where most of the action is.

Manchester, NH: The Reigning Champ

Manchester, New Hampshire, has clinched the No. 1 position, showcasing its appeal to homebuyers. According to Realtor.com's senior economic research analyst, Hannah Jones, Manchester's appeal is attributed to high demand meeting a scarce supply of available homes. This sustained demand has prevented the replenishment of inventory, keeping interest in properties high.

Here's a quick look at what makes Manchester so attractive:

• Median List Price: $579,000 in January 2025, an increase of almost 4% from the previous month.
• Days on Market: A speedy 46 days, much faster than the national median of 73 days.
• High Interest: Listings in Manchester received close to four times the typical views on Realtor.com compared to the national average.
• Location, Location, Location: Situated just 55 miles from Boston, it offers a blend of city access and smaller-town charm.
• Tax Benefits: New Hampshire residents enjoy no sales or income tax.
• Low Poverty: In 2023, the poverty level in the state was a low 7.2%, according to the U.S. Census Bureau.

The “Live Free or Die” state definitely offers something special! In my experience, the tax benefits alone can be a huge draw for people looking to relocate. Add in the proximity to Boston and the quality of life, and it's easy to see why Manchester is so popular.

The Top 20 Hottest Housing Markets: January 2025

Here's a rundown of the top 20 markets, according to Realtor.com:

Rank	Metro	Hotness Rank YoY	Median List Price
1	Manchester, NH	0	$579,000
2	Hartford, CT	-6	$408,000
3	Kenosha, WI	-4	$335,000
4	Norwich, CT	-2	$384,000
4	Worcester, MA	1	$527,000
6	Concord, NH	-13	$541,000
7	Rockford, IL	-11	$235,000
8	Lancaster, PA	-2	$409,000
9	Providence, RI	-8	$521,000
10	Rochester, NY	9	$258,000
11	Milwaukee, WI	-10	$363,000
12	Racine, WI	-13	$335,000
13	Springfield, MA	9	$328,000
14	Reading, PA	-13	$330,000
15	Boston, MA	0	$799,000
16	Peoria, IL	-28	$143,000
17	Bloomington, IL	-172	$291,000
18	Toledo, OH	-4	$220,000
19	Oshkosh, WI	14	$305,000
20	Canton, OH	-9	$237,000

Data: Realtor.com

Several cities on this list also deserve a closer look:

• Hartford, CT: Ranking second, Hartford saw particularly high listing views per property, exceeding the national median by over four times.
• Bloomington, IL: This city made its debut in the top 20, showing significant growth in popularity from within the top 50 markets.
• Boston, MA: Boston is a major metropolitan city with top educational institutions

What strikes me about this list is the strong presence of smaller to mid-sized cities in the Northeast and Midwest. This suggests that people are increasingly drawn to areas offering a balance of affordability, opportunity, and quality of life outside of major urban centers.

Regional Trends: Northeast and Midwest Dominate

For 16 months straight, the Northeast and Midwest have held the most spots on the Hottest Housing Markets list. Hannah Jones explains that this trend started around mid-2022 when mortgage rates began to rise. This suggests that buyers may be prioritizing affordability and value, which these regions often offer.

The real estate market is always influenced by economic factors like mortgage rates. When rates go up, people often look to areas where their money can go further.

Price Trends: Hot Markets See Slight Increases

Nationally, home prices fell by 2.2% year-over-year in January. However, the hottest markets saw a slight price increase of 1.5%. Demand in these hot markets was almost three times the national level, proving that high demand can still drive up prices even in a softening market.

In Manchester, for instance, the median list price rose by nearly 2.5% year-over-year. This shows that even though the national trend is downward, these high-demand areas are resisting that trend to some extent.

Inventory Challenges Persist

While the national increase in active listings was around 24.6% year-over-year, the hottest markets only saw an average increase of 12.7%. This indicates that inventory remains a significant challenge in these areas.

Even with the increase, the hottest markets had only about half the number of homes for sale in January compared to pre-pandemic levels. This is a much steeper decline than the national average, which is just under 25%.

These low inventory levels are a major factor in driving up competition and keeping homes selling quickly in these markets. It’s a tough situation for buyers, as there are fewer options and more people vying for the same properties.

Cooling Markets: Where's the Shift?

While the Northeast and Midwest are heating up, some Southern and Western markets are cooling down. Cities like Spokane, WA; Savannah, GA; and Rocky Mount, NC have seen the most significant declines in popularity.

This shift could be due to a variety of factors, including changing economic conditions, shifting demographics, and perhaps even a return to normalcy after the pandemic-fueled boom in certain areas. It's important to remember that real estate is local, and what's happening in one region may not be reflected in another.

Large Markets Showing Improvement

The 40 largest U.S. markets cooled by an average of seven spots in the hotness ranking compared to last year. However, they still drew 13.3% more views per listing than typical. Homes in these areas also spent nine fewer days on the market, despite list prices shrinking by 1.4%.

Cities like Philadelphia, New York City, and Kansas City, MO saw the biggest improvements in their hotness rankings among large cities. This suggests that these markets are starting to adjust to subdued buyer demand by lowering prices and offering more affordable options.

This is good news for buyers in these larger markets, as it indicates that they may have more negotiating power and a wider selection of homes to choose from.

Navigating the Hottest Markets: Tips for Buyers

If you're looking to buy in one of these hot markets, here are a few tips to keep in mind:

• Get Pre-Approved: This shows sellers you're a serious buyer and can move quickly.
• Work with a Local Agent: An agent who knows the market inside and out can be invaluable.
• Be Prepared to Act Fast: Homes in these markets don't stay on the market for long, so be ready to make a quick decision.
• Consider New Construction: As Hannah Jones mentioned, new construction can offer attractive prices and incentives.
• Be Flexible: You may need to compromise on some of your wish-list items to find a home that fits your budget and needs.

Looking Ahead: What's Next for the Housing Market?

Predicting the future of the housing market is always tricky, but a few trends seem likely to continue:

• Affordability will remain a key concern: As long as interest rates remain elevated, affordability will be a major factor for buyers.
• Inventory will continue to be a challenge: The lack of available homes is likely to persist in many markets, particularly the hottest ones.
• Regional differences will continue: The housing market is not a monolith, and different regions will experience different trends.

The housing market in 2025 is dynamic, with certain areas experiencing robust demand and others cooling off. It's crucial for both buyers and sellers to stay informed and work with experienced professionals who can help them navigate the complexities of their local market. I believe that understanding these trends and adapting to the changing conditions is key to making smart real estate decisions.