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Top 25 Hottest Real Estate Markets For 2021

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Published on April 16, 2021
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After such an unpredictable 2020, what’s in store for the housing market in 2021? As the previous year taught us, it can be hard to say for sure. But as we begin a new year, the experts have some predictions.

Each year, REALTOR.com® releases its housing market forecast for the year ahead, which includes the predicted growth in both number of sales and home prices for metro areas around the country. Below, we’ve rounded up their top 25 metro areas for combined predicted growth.

Last year, REALTOR.com® predicted that 2020 would see mortgage rates approaching 4% and next-to-no growth. Instead, the COVID-19 pandemic came and threw the market into a counterintuitive frenzy, with higher-than-ever prices, surging buyer demand and historically low mortgage rates.

The COVID-19 recession did little for affordability, as home prices in 2020 shot up more than 10% compared to the previous year. In 2021, according to these predictions, prices will continue to climb – though not quite as dramatically as they did in 2020, thanks to an increase in sellers that will help quell buyer demand.

For the entire U.S., REALTOR.com® predicts that in 2021 prices will see an increase of 5.7% year-over-year, while home sales will increase 7% year-over-year.

They also predict that mortgage rates, which have stayed below 3% since mid-2020, will finally creep back up over 3%, ending the year around 3.4%.

Zooming in, which metro areas are likely to see the most growth in 2021? Let’s take a look.

Note: Combined market growth is based on REALTOR.com® predictions of both sales growth and price growth. Median home values and population growth data comes from the U.S. Census Bureau.

1. Sacramento, California

  • Combined market growth: 24.6%
  • Median home value: $336,900
  • Population growth (from 2010 – 2019): 10. 1%

The Sacramento metro area is expected to see a huge amount of movement in home sales, with a predicted 17.2% year-over-year increase. Prices will experience an impressive amount of appreciation as well, at 7.4% year-over-year.

2. San Jose, California

  • Combined market growth: 21.6%
  • Median home value: $864,600
  • Population growth (from 2010 – 2019): 7.3%

According to the forecast, San Jose and its surrounding areas will see an equal amount of sales and price growth: a 10.8% increase in both categories.

Buyers hoping to settle in this Silicon Valley hotspot can expect a hot market with homes regularly selling over list price.

3. Charlotte, North Carolina

  • Combined market growth: 19%
  • Median home value: $220,300
  • Population growth (from 2010 – 2019): 20.4%

The Charlotte area, also known as Metrolina, made the #3 spot for growth thanks to the substantial growth in home sales it’s expected to see in 2021 – a 13.8% increase, according to the forecast.

Expected price growth is more in line with national appreciation expectations, at 5.2%.

4. Boise, Idaho

  • Combined market growth: 19.8%
  • Median home value: $253,400
  • Population growth (from 2010 – 2019): 9.3%

It’s no secret that people are flocking to Idaho, and Boise in particular, for its affordable living, ample cultural amenities and abundant offerings for outdoorsy types. However, so much movement has caused the market to heat up significantly in recent years.

In 2021, Boise is expected to see a fair amount of both sales growth and price growth – 9.8% and 9.1%, respectively.

5. Seattle, Washington

  • Combined market growth: 18.6%
  • Median home value: $663,100
  • Population growth (from 2010 – 2019): 23.8%

Low inventory is the name of the game in Seattle’s real estate market, which means that sellers typically have the upper hand in negotiations.

In 2021, REALTOR.com® forecasts an 8.9% increase in home sales and 9.7% increase in prices.

6. Phoenix, Arizona

  • Combined market growth: 18.4%
  • Median home value: $235,400
  • Population growth (from 2010 – 2019): 16.2%

With a market as hot as the Phoenix sun, sellers in this area will likely remain in an ideal spot in 2021, while buyers will need to move fast and be prepared to make some compromises to get into a home.

The number of sales will likely increase quite a bit this year, up 11.4% from last year, while prices are slated to increase 7%.

7. Harrisburg, Pennsylvania

  • Combined market growth: 18.2%
  • Median home value: $80,800
  • Population growth (from 2010 – 2019): -0.5%

Pennsylvania state capital Harrisburg is a hot but relatively affordable market compared to some of the other metros on this list.

Lucky for buyers, home sales are predicted to increase 14.4% in this area, while prices will grow fairly modestly at 3.8%.

8. Oxnard, California

  • Combined market growth: 18%
  • Median home value: $453,900
  • Population growth (from 2010 – 2019): 5.5%

Another spot for big sales growth and average price increases is the SoCal beach town of Oxnard, which REALTOR.com® has at a 12.5% increase in sales and a 5.5% increase in prices.

Oxnard is a good spot for buyers looking for all the benefits of beautiful Southern California without the price tags of some of its most popular areas.

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9. Denver, Colorado

  • Combined market growth: 179%
  • Median home value: $390,600
  • Population growth (from 2010 – 2019): 21.2%

The Denver area tied with Riverside and Columbus for overall growth, but Denver was the standout among the three in terms of home sales growth, with a predicted 12.5% year-over-year increase in sales.

For price appreciation, Denver should expect a more average increase of 5.4%.

10. Riverside, California

  • Combined market growth: 17.9%
  • Median home value: $365,300
  • Population growth (from 2010 – 2019): 9%

The Inland Empire metro area, which also includes the cities of San Bernardino and Ontario, California, is expected to experience a 12.4% increase in home sales and a 5.5% increase in prices. Make no mistake, the Riverside market is a hot one, but it’s a bit more affordable for those who love SoCal but don’t love the sky-high prices that come with it.

11. Columbus, Ohio

  • Combined market growth: 17.9%
  • Median home value: $151,600
  • Population growth (from 2010 – 2019): 13.9%

Compared to the other areas it’s in a three-way tie with, Columbus will see much more even growth across both sales and prices. REALTOR.com® predicts a 10.3% increase in sales and a 7.6% increase in prices.

Columbus has an affordable cost of living and a strong job market, making it a great spot for buyers who are longing for affordability.

12. Bridgeport, Connecticut

  • Combined market growth: 17.5%
  • Median home value: $174,700
  • Population growth (from 2010 – 2019): 0.1%

The Bridgeport-Stamford-Norwalk market is a little cooler than some of the others on this list, but will likely see a good amount of growth in 2021. REALTOR.com® predicts a 9.7% increase in sales and a 7.8% increase in prices.

13. Fresno, California

  • Combined market growth: 17.4%
  • Median home value: $242,000
  • Population growth (from 2010 – 2019): 6.9%

Fresno is a competitive market where homes sell fast, which means that buyers need to move quickly to get the home they want.

For growth in the Fresno housing market, it’s predicted the area will experience an 8.9% increase in home sales and an 8.5% increase in prices.

14. Los Angeles, California

  • Combined market growth: 17.3%
  • Median home value: $636,900
  • Population growth (from 2010 – 2019): 4.9%

Beautiful, unique and expensive Los Angeles can be tough to navigate for buyers with smaller housing budgets, especially as prices continue to grow.

Los Angeles is expected to see a 10% increase in home sales, and a 7.3% increase in prices in 2021.

15. Las Vegas, Nevada

  • Combined market growth: 17.2%
  • Median home value: $258,600
  • Population growth (from 2010 – 2019): 11.4%

The Las Vegas area is likely to see a lot of growth in the number of sales and more average price growth. In 2021, the experts expect this market will experience an impressive 12% increase in home sales and a 5.2% increase in prices.

16. El Paso, Texas

  • Combined market growth: 17%
  • Median home value: $127,400
  • Population growth (from 2010 – 2019): 5.2%

The thriving border city of El Paso is slated to experience significant growth in 2021. Sales are forecasted to increase 10.6% year-over-year, while prices will grow slightly above the median at 6.4%.

Buyers looking to settle in this area will appreciate the fact that El Paso is consistently ranked as one of the safest cities in the U.S.

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17. North Port, Florida

  • Combined market growth: 16.9%
  • Median home value: $188,700
  • Population growth (from 2010 – 2019): 23.4%

North Port, located about an hour north of Fort Myers, is home to a competitive but affordable real estate market. In 2021, North Port buyers and sellers can expect a 10.3% increase in home sales and a 6.6% increase in prices.

18. San Diego, California

  • Combined market growth: 16.8%
  • Median home value: $602,600
  • Population growth (from 2010 – 2019): 9.4%

Sunny San Diego is one of the best places to live in California, but like many of the state’s most popular cities, it struggles with affordability. The number of home sales will likely increase quite a bit compared to last year, with an estimated 11.3% increase. Price increases will be a bit milder, with a predicted 5.5% increase.

19. Palm Bay, Florida

  • Combined market growth: 16.3%
  • Median home value: $155,200
  • Population growth (from 2010 – 2019): 11.1%

This Central Florida city is affordable and a little less competitive market-wise than some of the other entries on this list. Palm Bay is in that sweet spot where the number of sales is expected to increase significantly while prices experience a softer boost.

REALTOR.com® predicts an 11.6% increase in sales and a 4.7% increase in prices for this area in 2021.

20. Tampa, Florida

  • Combined market growth: 16.2%
  • Median home value: $238,900
  • Population growth (from 2010 – 2019): 18.9%

The Tampa Bay area, which also includes St. Petersburg and Clearwater, is one of the best places to live in the U.S., particularly for retirees.

In 2021, the Tampa region is predicted to have strong, fairly equal growth among both sales and price, with an 8.7% increase in sales and a 7.5% increase in prices.

21. Orlando, Florida

  • Combined market growth: 15.9%
  • Median home value: $240,000
  • Population growth (from 2010 – 2019): 20.4%

A dream destination for theme park lovers, Orlando is more than a great vacation spot. As its housing market continues heating up in 2021, buyers and sellers can expect sales to increase 10.1% year-over-year and prices to increase 5.8% year-over-year.

22. Dallas, Texas

  • Combined market growth: 15.7%
  • Median home value: $188,100
  • Population growth (from 2010 – 2019): 12.2%

Everything’s bigger in Texas, and that includes the growth in home sales Dallas is expected to see in 2021: 11.3%.

Price growth in the Dallas area will be much more moderate, at 4.4%. Buyers should beware, however, that inventory is tight here and the market is red hot. Be prepared to compete for what you want.

23. Kansas City, Missouri

  • Combined market growth: 15.6%
  • Median home value: $154,600
  • Population growth (from 2010 – 2019): 7.7%

Kansas City is another area that will likely see many more sales happening this year compared to last year, while price growth will be comparatively modest.

The forecast predicts a 12.1% increase in sales for this metro area and a 3.5% increase in prices.

24. Hartford, Connecticut

  • Combined market growth: 15.5%
  • Median home value: $165,300
  • Population growth (from 2010 – 2019): -2.1%

Hartford’s housing market had a red-hot year in 2020, and 2021 is shaping up to be another strong year for home sales.

REALTOR.com® predicts a 12.1% increase in the number of home sales in the Hartford metro area. Home prices will appreciate at a much lower rate: 3.4%.

25. Jacksonville, Florida

  • Combined market growth: 14.4%
  • Median home value: $173,200
  • Population growth (from 2010 – 2019): 10.9%

Vibrant Jacksonville has a relatively affordable cost of living and, like the other metro areas on this list, a hot real estate market that’s not likely to cool off anytime soon.

In terms of the number of home sales, Jacksonville is predicted to see a 9.4% increase, while prices are expected to increase 5%.

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 online with Rocket Mortgage®.

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