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Top 25 Hottest Real Estate Markets For 2020

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Published on February 5, 2020
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Wondering where to find the hottest real estate markets this year?

A lot of speculating has been done over what the housing market and the larger economy will do in 2020. While no one can tell the future for certain, there are a few things, including real estate trends, that experts can look to that help them determine what’s likely to happen.

The market seems to be in a relatively good spot as we begin 2020. Mortgage rates are at historic lows and may maintain some stability throughout the year.

However, lack of inventory is a big problem, especially when it comes to more affordable starter homes. Tight inventory can drive up home prices and make getting into a house much more difficult for buyers, especially first-time home buyers.

In December, REALTOR.com® released its “2020 Housing Market Predictions” report, which included a forecast of sales and price growth for real estate markets across the country.

Which markets were standouts in terms of growth? Let’s take a look at what the experts had to say.

For the U.S. as a whole, the housing market will likely see a decline in growth, according to the predictions, with home sales falling by 1.8% and prices growing by only 0.8%.

Note: Days on market and median list price data are based on REALTOR.com® December 2019 data, and population growth data comes from the U.S. Census Bureau. Cities are ranked according to the overall percentage of predicted growth for both sales and prices.

1. Boise City, Idaho

  • Days On Market: 58
  • Median List Price: $367,000
  • Population Growth (From 2010 – 2018): 3%

REALTOR.com® predicts that Boise City will see a small amount of growth in home sales, just 0.3%, and a relatively large jump in home prices, with an increase of 8.1%.

With such a large increase in prices, this could be unfortunate news for Boise home shoppers looking for affordability.

In terms of the overall increase in growth, this housing market is tied with our second entry, the McAllen-Edinburg-Mission, Texas, metropolitan area, which will see the same amount of combined growth, but with a much different distribution, as Boise’s overall growth is largely influenced by its expected price growth.

2. McAllen-Edinburg-Mission, Texas

  • Days On Market: 85
  • Median List Price: $199,000
  • Population Growth (From 2010 – 2018) For McAllen: 9%
  • Population Growth (From 2010 – 2018) For Edinburg: 3%
  • Population Growth (From 2010 – 2018) For Mission: 2%

This South Texas metropolitan area will likely see a fair amount of growth in both home sales and home prices, with 4.4% and 4% increases, respectively.

Tied for first place with Boise, this area will see an even amount of growth both in sales and prices, making the market a little friendlier to buyers.

3. Tucson, Arizona

  • Days On Market: 57
  • Median List Price: $288,000
  • Population Growth (From 2010 – 2018): 7%

Tucson is expected to have a 3.4% bump in home sales and a 3.3% bump in home prices.

Why is Tucson going to be so hot this year? Like in many other cases, extremely low inventory has really affected this market, and competition is likely going to be fierce in 2020.

4. Chattanooga, Tennessee-Georgia

  • Days On Market: 77
  • Median List Price: $295,000
  • Population Growth (From 2010 – 2018) For Chattanooga: 6%

For this metro area, which includes counties in both southeast Tennessee and northwest Georgia, REALTOR.com® predicts a 2% rise in home sales and a 3.6% rise in prices.

Chattanooga’s hot market may also be bolstered by new residents looking to relocate to a smaller, growing urban area.

5. Columbia, South Carolina

  • Days On Market: 68
  • Median List Price: $227,000
  • Population Growth (From 2010 – 2018): 3%

Interestingly, Columbia may see a relatively significant increase in home sales (5.5%) in addition to a slight dip in home prices (-0.2%).

Columbia is another market that’s been suffering from limited inventory. Homes sell at lightning speed here, so buyers in this market need to be prepared to move fast and make clean, high offers.

6. Rochester, New York

  • Days On Market: 62
  • Median List Price: $200,000
  • Population Growth (From 2010 – 2018): -2.1%

This Upstate New York area could see home sales grow by 4.7%, with prices only inching up by a mere 0.4%.

Though Rochester is a highly competitive market, it’s managed to remain a relatively affordable one and is expected to continue that trend through this new year.

7. Colorado Springs, Colorado

  • Days On Market: 60
  • Median List Price: $440,000
  • Population Growth (From 2010 – 2018): 2%

In Colorado Springs, home sales may actually slow a bit – by a predicted -1.4%. However, prices may increase quite a bit at 6.3%.

Entry-level buyers will likely have trouble wedging their ways into this housing market, with fewer and fewer homes to be found below the $300,000 price point.

8. Winston-Salem, North Carolina

  • Days On Market: 77
  • Median List Price: $275,000
  • Population Growth (From 2010 – 2018): 3%

The Winston-Salem housing market may see a 3.6% increase in home sales and a smaller 0.5% increase in home prices.

As in other markets, low inventory is an issue in Winston-Salem, though finding an affordable home in this area is still possible.

9. Charleston-North Charleston, South Carolina

  • Days On Market: 88
  • Median List Price: $415,000
  • Population Growth (From 2010 – 2018) For Charleston: 13%
  • Population Growth (From 2010 – 2018) For North Charleston: 1%

This urban area will see a more moderate increase in both home sales and home prices (1.2% and 1.9%, respectively).

This area is tied with the Memphis metro area in terms of the overall amount of predicted growth these two places will likely see.

Because it’s such a highly desirable area, Charleston isn’t the most affordable place to live. However, competition here is more moderate than in other places on this list.

10. Memphis, Tennessee-Mississippi-Arkansas

  • Days On Market: 68
  • Median List Price: $233,000
  • Population Growth (From 2010 – 2018) For Memphis: -0.2%

The Memphis metro area housing market could see the rate of home sales stay nearly stagnant with a predicted 0.1% increase, while prices may increase a bit, with a 3% increase predicted.

Though it’s tied with Charleston, Memphis is a significantly more affordable market and the more competitive of the two. First-time buyers should be able to find a place to call home in Memphis in 2020, but they’ll have to move quickly to get what they want.

11. Cleveland-Elyria, Ohio

  • Days On Market: 73
  • Median List Price: $180,000
  • Population Growth (From 2010 – 2018) For Cleveland: -3.2%
  • Population Growth (From 2010 – 2018) For Elyria: -1.2%

The Cleveland-Elyria metro area could see a 2.6% increase in home sales and a 0.4% increase in home prices.

This metro area is in a three-way tie with Phoenix-Mesa-Scottsdale and Salt Lake City. However, Cleveland-Elyria is by far the most affordable of these three areas. This is good news for buyers, but as in Memphis, they’ll need to be smart and speedy to navigate this hot market.

12. Phoenix-Mesa-Scottsdale, Arizona

  • Days On Market: 55
  • Median List Price: $375,000
  • Population Growth (From 2010 – 2018) For Phoenix: 7%
  • Population Growth (From 2010 – 2018) For Mesa: 7%
  • Population Growth (From 2010 – 2018) For Scottsdale: 4%

In this area, known as the Valley of the Sun, home sales may drop a bit (-0.4%) while home prices may get a bump, with a predicted 3.4% increase.

As you can see from the population growth for all three cities in this metro area, new residents have been moving to Metro Phoenix in droves when compared to the meager or even nonexistent growth in many other cities named on this list. Because it’s such a growing area, expect stiff competition to get into a home.

13. Salt Lake City, Utah

  • Days On Market: 58
  • Median List Price: $451,000
  • Population Growth (From 2010 – 2018): 6%

This friendly locale is predicted to experience a very slight dip in home sales (-0.5%) and a 3.5% increase in home prices.

Salt Lake City is a hot and pricey market, with home prices reaching an all-time high in late 2019. Entry-level buyers may have a tough time finding a suitable home.

14. Knoxville, Tennessee

  • Days On Market: 75
  • Median List Price: $285,000
  • Population Growth (From 2010 – 2018): 2%

Knoxville’s real estate market growth will be fairly moderate across the board, with a 1.6% increase in home sales and a 1.3% increase in home prices.

Though it’s not one of the most expensive markets on this list, the most affordable homes in this area have seen a pretty significant increase in price since 2018, making it more difficult for first-time buyers to find homes within their price range.

15. Spokane-Spokane Valley, Washington

  • Days On Market: 65
  • Median List Price: $349,000
  • Population Growth (From 2010 – 2018) For Spokane: 6%
  • Population Growth (From 2010 – 2018) For Spokane Valley: 1%

This metro area is predicted to experience a 1.5% increase in home sales and a 1.3% increase in prices.

In terms of growth, the Spokane area will likely be fairly moderate in 2020. However, navigating the housing market will be tricky, as this locale is host to one of the most competitive markets in the country, largely due to its super tight inventory.

16. Allentown-Bethlehem-Easton, Pennsylvania-New Jersey

  • Days On Market: 75
  • Median List Price: $240,000
  • Population Growth (From 2010 – 2018) For Allentown: 8%
  • Population Growth (From 2010 – 2018) For Bethlehem: 1%
  • Population Growth (From 2010 – 2018) For Easton: 5%

The Lehigh Valley, as this area is known, might see an increase in home sales (2.3%) while avoiding a significant jump in home prices, with just a 0.4% increase expected.

Our list has one more three-way tie between Allentown-Bethlehem-Easton, Orlando-Kissimmee-Sanford and Urban Honolulu.

Of these three, this area tends to have more affordable housing than the popular beach (or retirement) destinations in Florida and Hawaii. However, that affordability may be increasingly difficult to come by, thanks to low supply and lots of competition.

17. Orlando-Kissimmee-Sanford, Florida

  • Days On Market: 68
  • Median List Price: $318,000
  • Population Growth (From 2010 – 2018) For Orlando: 6%
  • Population Growth (From 2010 – 2018) For Kissimmee: 5%
  • Population Growth (From 2010 – 2018) For Sanford: 4%

The Greater Orlando area should expect a 0.9% increase in home sales and a 1.8% increase in home prices.

Like everywhere else, low inventory is the name of the game in this metro area, with the lack of lower range, entry-level homes presenting the biggest challenge for buyers.

18. Urban Honolulu, Hawaii

  • Days On Market: 75
  • Median List Price: $664,000
  • Population Growth (From 2010 – 2018): 9%

The city of Honolulu may actually see an increase in home sales (3.6%) and a decrease in prices (-0.9%).

While the Honolulu market will likely see some growth in 2020, its sky-high prices may actually make housing a little less competitive for those who can afford it.

19. Akron, Ohio

  • Days On Market: 62
  • Median List Price: $151,000
  • Population Growth (From 2010 – 2018): -0.6%

This Ohio city is predicted to have a fair amount of growth in home sales (2.6%), while home prices are expected to remain completely stagnant.

Compared to other locales on this list, Akron is remarkably affordable. With home prices predicted to stay put in 2020, this could be a good year for first-time home buyers to enter the housing market and try their luck.

Akron is in a four-way tie on our list with Cape Coral-Fort Myers, New Haven-Milford and Portland-South Portland.

20. Cape Coral-Fort Myers, Florida

  • Days On Market: 75
  • Median List Price: $319,000
  • Population Growth (From 2010 – 2018) For Cape Coral: 7%
  • Population Growth (From 2010 – 2018) For Fort Myers: 32%

REALTOR.com® predicts that this beachy metro area will see no growth in home sales and a 2.6% increase in prices.

Home shoppers in desirable areas, especially coastal cities, should expect to pay a premium for highly sought-after real estate. Buyers looking for affordability in these areas will have a challenge to find something suitable.

21. New Haven-Milford, Connecticut

  • Days On Market: 82
  • Median List Price: $260,000
  • Population Growth (From 2010 – 2018) For New Haven: 4%
  • Population Growth (From 2010 – 2018) For Milford: 6%

The Greater New Haven Area is expected to see a lot of growth in home sales, with a 5% increase, and a significant drop in prices, with a predicted 2.4% decrease.

This area experienced a bit of volatility in 2019 in its housing market, with home sales dropping significantly early last year. In 2020, significant sales growth may help make up for some of that past uncertainty.

22. Portland-South Portland, Maine

  • Days On Market: 89
  • Median List Price: $389,000
  • Population Growth (From 2010 – 2018) For Portland: 3%
  • Population Growth (From 2010 – 2018) For South Portland: 4%

Growth will be moderate for this Maine metro area, with an expected 1.4% increase in home sales and a 1.2% increase in home prices.

Lack of affordable inventory, increasing demand and rising home prices will likely present a problem for buyers looking for entry-level homes in the Portland area. Competition is fierce, and deep-pocketed out-of-state buyers are pricing out locals.

23. Raleigh, North Carolina

  • Days On Market: 69
  • Median List Price: $363,000
  • Population Growth (From 2010 – 2018): 1%

Home sales growth will be almost nonexistent in Raleigh, with just a 0.2% expected increase, while prices are expected to go up by 2.2%.

Competition may not be as fierce as in some of these super-hot markets, but low inventory will continue to be a driver of rising prices in Raleigh.

24. Seattle-Tacoma-Bellevue, Washington

  • Days On Market: 63
  • Median List Price: $582,000
  • Population Growth (From 2010 – 2018) For Seattle: 4%
  • Population Growth (From 2010 – 2018) For Tacoma: 1%
  • Population Growth (From 2010 – 2018) For Bellevue: 4%

The Seattle metro area will likely see a drop in home sales (-0.8%) and a bump in prices (3.1%).

Seattle is known for having a tricky housing market, where affordability is a major issue. Tight inventory and high demand also means that those who can afford this market will be fighting over available homes.

25. Tampa-St. Petersburg-Clearwater, Florida

  • Days On Market: 64
  • Median List Price: $277,000
  • Population Growth (From 2010 – 2018) For Tampa: 9%
  • Population Growth (From 2010 – 2018) For St. Petersburg: 1%
  • Population Growth (From 2010 – 2018) For Clearwater: 8%

The Tampa Bay area may see a slight increase in home sales at just 0.6% and a moderate increase in home prices at 1.6%.

Expect this market to stay hot throughout 2020. Though with a median list price of just $277,000, buyers looking in the mid- or lower ranges may be able to find a home they like. Just be ready to face some competition to get it.

Home Buying In Hot Real Estate Markets

If you’re shopping or selling in a hot real estate market, that means competition is fierce, with homes typically getting multiple offers and buyers engaging in bidding wars that drive up home prices.

For sellers, this is great. Having multiple offers on your home means you get to take your pick of the buyer who’s offering the best terms, whether they’re offering above asking price or waiving contingencies.

If you’re buying a home in a hot market, you’ll more than likely be competing with other buyers to get into the home of your dreams. This means you’ll need to strategize your offer to give it the best chance.

Be sure to discuss with your real estate agent what you’re willing to offer to get into the house you want, whether that’s a higher price, a contingency-free offer, or giving the seller certain things that they may want, such as a rent-back agreement that allows the seller to stay in the home for a certain amount of time after closing.

Ready to get going with the home buying process? You can get started onlinewith Rocket Mortgage® by Quicken Loans®.

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