SEATTLE, WA — Buffalo, New York, is set to be the hottest major housing market in the nation for 2025, according to Zillow’s latest analysis. This marks the first time a city has held the top spot two years in a row, driven by factors including relative affordability and strong employment growth.
Competition among buyers in Buffalo has remained fierce as job creation in the area continues to outpace new home construction. This imbalance has intensified demand and boosted home prices, solidifying the city’s position as a standout housing market.
“Construction that keeps pace with an area’s growth remains a crucial piece of keeping homes available and accessible,” said Zillow Chief Economist Skylar Olsen. “Buffalo’s employment is growing far faster than builders are adding homes, and that will keep the market hot for buyers.”
Zillow’s ranking considers forecasts for home value growth, how quickly homes are selling, job growth relative to new home construction, and expected increases in owner-occupied households. Buffalo, with more new jobs per home permitted than any other metro, leads the pack in expected demand.
Affordability Fuels Midwest and Northeast Demand
Buffalo’s relative affordability compared to pricier cities in the Northeast, such as New York and Boston, adds to its appeal. Home prices and rents in the city remain below national averages, opening opportunities for buyers seeking greater value for their money.
The ranking reflects a trend favoring affordable metros across the Midwest and Northeast. Cities like Hartford, Providence, and Philadelphia have similarly benefited from serving as less expensive alternatives to larger metro areas within their regions.
Hartford is projected to see the highest home value growth among U.S. cities in 2025, with an expected increase of 4.2%, followed by strong gains in Providence, Indianapolis, and Charlotte. Even so, Zillow expects overall home price growth across the nation to moderate compared to the surges seen in 2021 and 2022.
Market Shifts Across Regions
Virginia Beach made the most dramatic climb in Zillow’s rankings, rising 23 spots to No. 13. It gained ground thanks to robust job growth that has far outstripped new home construction. Conversely, Memphis saw the largest drop, falling 30 places as new home construction has outpaced local job creation.
On the West Coast, Salt Lake City broke into the top 10 at No. 10, marking a return of western metros to Zillow’s hottest markets list after none made last year’s top spots. San Diego also ranked in the top 20, taking the No. 19 slot.
Looking Ahead to 2025
Housing market trends for 2025 remain highly dependent on fluctuating mortgage rates, which continue to influence affordability and buyer behavior. While more homes are expected to be available for sale than in recent years, price growth is anticipated to be slow but steady.
Buffalo’s emergence as a leading housing market highlights the lasting appeal of affordability and economic opportunity in shaping where Americans choose to live. With its strong fundamentals, the city is well-positioned to maintain its competitive edge in the housing sector.
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