The Hottest U.S. Housing Markets
In 2025, the U.S. housing market is heating up in unexpected places. Forget the coastal megacities; the real action is happening in mid-sized metros where big-city amenities meet lower housing costs. These blazing markets are attracting buyers and investors with a powerful combination of job growth, affordability, and a surprisingly stable development environment.
The “Gateway to the West” MSA offers job growth, low unemployment, a lower cost of living, and a low-risk housing development process.
Key Takeaways
The top-ranked MSAs are located in a variety of locations including Nebraska, Texas, South Carolina, and Colorado.
Markets to watch that improved the most between June and January include Orlando, Florida; St. Louis; Greeley, Colorado; Richmond, Virginia; and Southern California’s Inland Empire counties, which include Riverside and San Bernardino.
The most resilient markets that improved year-over-year through January were led by Columbia, South Carolina; Kansas City, Missouri; Los Angeles; San Jose, California; and Boise City, Idaho.
With inflation through February slowly heading in the right direction and 30-year fixed mortgage rates recently settling in at about 6.7%, hopeful homebuyers are slowly edging back into the housing market. But is it enough to unlock a semifrozen housing market?
The good news is that according to Freddie Mac, applications for mortgage purchase loans were up 5% year-over-year through mid-March. At the same time, with stock markets in flux and consumer sentiment dipping sharply in recent weeks, if concerns about rebounding inflation and job security continue to build, that could prompt some buyers to wait for more certainty.
Still, even if consumers hold back on high-ticket items such as new cars, trips, and electronics, the stability of owning one’s own home is a powerful motivator to take the plunge into the housing market – especially if it’s relatively affordable, such as in the hottest housing market for January.
Since the metrics for local housing markets will not be equal for each region, state, or city, it’s important for buyers and sellers to do their research, rank their must-haves, and find the best agents for their situations.
Our analysis of the hottest housing markets pulls from the U.S. News Housing Market Index, which incorporates a wide array of data points and provides a simple yet comprehensive way to rank the covered metropolitan statistical areas (MSAs) from frigid to balmy on a scale of 1-100. This particular ranking is based on data from January 2025.
Hottest Markets Overall
Although the hottest MSA scores ranged up to 76.2, there were lower-scoring MSAs under 50, including Boston, Sacramento, and two markets in Florida. At the top of the spectrum, the following MSAs are the hottest housing markets ranked from first to fifth:
Omaha, Nebraska – 76.2
Austin, Texas – 72.3
Houston – 72.1
Charleston, South Carolina – 71.6
Denver – 71.5
Given a tightening job market with employers regaining the balance of power, working remotely full time is much less of a consideration for today’s homebuyers. As a result, the metrics that define a relatively hot housing market are returning to the traditional basics of local demand, supply, and financial considerations. Whether in Nebraska or South Carolina, what these hottest markets seem to share are big-city amenities without the high housing costs of MSAs closer to the megacities along the West and East coasts.
The Hottest MSA Overall: Omaha, Nebraska
The Omaha, Nebraska, MSA offers a mix of strengths, including positive job growth thanks in large part to robust economic development activities, a lower unemployment rate versus the overall U.S., a reduced cost of living compared with many large metro areas, and a practical process to encourage new housing developments at a lesser risk to homebuilders.
“We have something for anyone, including urban vibrancy, great suburban neighborhoods, historic neighborhoods with character and family dynamics, and tranquil spaces as well,” says Alec Gorynski, senior vice president of economic development for the Greater Omaha Chamber of Commerce. With the region just crossing over the one million population threshold and jobs growing at a healthy clip, Gorynski is not surprised by Omaha’s top ranking.
On the economic front, Gorynski notes that besides a low unemployment rate, Omaha’s labor participation rate of nearly 67% compares favorably with a national rate of just over 62%, which keeps the chamber quite busy given that their workforce extends far beyond the city’s borders. As he explains, the Greater Omaha economic development partnership extends across eight counties to include a much broader labor shed with various employment centers, adding, “It’s much better to collaborate than compete with each other.”
The larger challenge for the chamber’s economic development team, which is funded by the city of Omaha as well as private sector firms and individuals, is recruiting new employers and people to the area while also retaining those who might otherwise depart to other states.
“We’re working to grow the economy with some strong industries with a diverse employment base,” notes Gorynski. “This lends itself to economic resiliency, so we’re not overly dependent on one industry, which makes it smoother for us versus the rest of the country.”
Here’s a deeper look at the various data points regularly tracked by the Housing Market Index for this MSA:
| Metric | Omaha MSA (January 2025) | U.S. Average (January 2025) | Change |
| :— | :— | :— | :— |
| Overall HMI Score | 76.2 | 66.6 | +9.6 |
| Demand HMI | 82.3 | 77.5 | +4.8 |
| Supply HMI | 51.4 | 60.5 | -9.1 |
| Financial HMI | 94.9 | 61.1 | +33.8 |
| Median Home Price | $304,000 | $419,000 | -27.4% |
| Housing Supply (Months) | 2.2 | 3.6 | -38.9% |
| Unemployment Rate | 2.8% | 4.1% | -31.7% |
| Median Rent | $1,348 | $1,968 | -31.5% |
The overall Housing Market Index score of 76.2 for the Omaha MSA rose 0.7 points year-over-year through January and compares with 75.5 in January 2024. At the same time, the overall HMI for the United States fell by -0.8 points to 66.6. Notably, when compared with that of the overall U.S., the HMI in Omaha has consistently ranked higher since December 2019.
The three subindexes covering demand, supply, and financial factors for January are also calculated on the same scale of 1-100.
Demand HMI – 82.3 (80.7 in June 2024)
Supply HMI – 51.4 (45.2 in June 2024)
Financial HMI – 94.9 (95.4 in June 2024)
During the 12-month period ending December 2024, the Omaha MSA gained more than 12,000 nonfarm jobs, for a growth rate of about 2.4%. According to the Bureau of Labor Statistics, the highest percentage of increases in job categories include information, education and health services, and leisure and hospitality. Omaha’s unemployment rate in December was just 2.8% versus 4.1% for the overall U.S.
As urban areas of north and south Omaha continue to redevelop with new apartments and a few smaller developments with single-family homes for sale, the overall mix of building permits in the greater Omaha MSA has meant a higher average share for multifamily units over the past year, rising by several percentage points to 41% versus 32% in 2018. Looking ahead to our building permit forecasts to the middle of 2025, look for the mix of single-family to multifamily permits to average about 56% and 44% of the total, or approximately 310 and 240 units per month, respectively.
Since hitting a record high of $325,000 in June, the median home sales price in Omaha has fallen to $304,000. Still, home prices here rose 4.8% year-over-year versus a national rise of 4.2% to $419,000, or 38% higher than in Omaha.
Last June, the Omaha MSA had under 1.2 months of supply, making for an unusually tight seller’s market. Since then, while the supply has varied month to month, ultimately rising to 2.2 months, it’s still much lower than the national average of
