The National Association of Realtors (NAR) has unveiled its list of the 10 hottest housing markets for 2025, based on economic, demographic, and housing trends expected to significantly impact local markets. These insights are detailed in NAR’s latest report, Housing Hot Spots for 2025: Top Markets Amid Stabilizing Rates. During NAR’s sixth annual Real Estate Forecast Summit: The Year Ahead, Chief Economist and Senior Vice President of Research Lawrence Yun presented the top 10 housing markets, shared a 2025 real estate and economic outlook, and reviewed the 2024 housing market.

“Key factors driving the top-performing markets in 2025 include affordable inventory, improved chances of unlocking low mortgage rates, higher income growth among young adults, and positive net migration into specific metro areas,” said Yun.

Top Housing Markets for 2025

Listed alphabetically, these 10 metro areas stand out for their strong performance across various metrics. Each market benefits from a favorable financing environment–featuring lower mortgage rates or fewer homeowners locked into existing loans. Most of these markets also surpass national averages in at least six of NAR’s 10 key indicators.

• Boston-Cambridge-Newton, MA-NH
• Charlotte-Concord-Gastonia, NC-SC
• Grand Rapids-Kentwood, MI
• Greenville-Anderson, SC
• Hartford-East Hartford-Middletown, CT
• Indianapolis-Carmel-Anderson, IN
• Kansas City, MO-KS
• Knoxville, TN
• Phoenix-Mesa-Chandler, AZ
• San Antonio-New Braunfels, TX

2025 U.S. Market Outlook

NAR projects the Federal Reserve will adopt a gradual approach to easing monetary policy in 2025. While concerns over federal deficits and rising public debt may limit the extent of rate cuts, borrowing costs are expected to stabilize, providing relief to prospective buyers. Mortgage rates are forecast to hover around 6% – a level likely to establish a new normal. This stabilization is expected to reignite market activity, with existing-home sales projected to reach 4.5 million units in 2025.

Home prices are also expected to grow at a modest pace, increasing by approximately 2%, with the median existing-home price reaching $410,700. While the national housing shortage persists, inventory levels are improving, and further growth is anticipated in 2025. This is driven by new construction projects and more homeowners listing their properties, encouraged by stable mortgage rates and improving market conditions. NAR forecasts housing starts to reach 1.45 million units, close to the historical annual average of 1.5 million units.

“Homebuyers will find better opportunities next year,” Yun added. “The worst of the affordability crisis is behind us, as improving inventory, stable mortgage rates, and continued job and income growth create pathways to homeownership for more Americans.”