As the U.S. housing market enters 2025, it is experiencing renewed activity after years of volatility. Although home prices remain high, pent-up demand, wage growth, and increased housing inventory have improved conditions for buyers. Construction Coverage analyzed the 600 most populous metros across the U.S. to get a better understanding of which markets are gaining the most traction with buyers.
The Northeast and California lead the way, with Connecticut seeing the most buyer activity, followed by New Jersey, Massachusetts, and Rhode Island. California remains active as well, despite its high cost of living, with cities such as San Jose, San Francisco, and Oakland among the hottest markets.
By contrast, many Southern and Mountain West markets have cooled off. In 2021, Texas cities like Arlington, Fort Worth, and Austin ranked among the top 15 hottest markets. However, entering 2025, those same cities have dropped into the bottom 20 of the rankings. Similarly, Phoenix and Mesa, AZ, which were among the most in-demand real estate markets during the pandemic, now rank near the bottom. The rapid home price increases in these regions—combined with rising mortgage rates and return-to-office mandates—have made these once-popular migration destinations less attractive to buyers. Read more