Assume homebuyers are jonesing to live in California, Florida, or some other warm, sunny locale? Not so fast. Many of America’s hottest markets today are hiding in far more surprising places — like Indiana, New Hampshire, and Connecticut.
Each of these states boasted three metropolitan areas on the Realtor.com® 20 Hottest Markets rankings for May. (The hottest markets report factors in a combination of demand measured by the number of unique views per listing and how quickly properties sell measured by the number of days on the market.)
The allure in these unassuming areas largely boils down to the real estate deals that can be had here.
“Affordability is the common thread running through the top states featured in May’s hottest housing markets list,” says George Ratiu, manager of economic research for Realtor.com. “With median home prices below the national mark, these states offer buyers significant value.”
Indeed, the average listing price for the 20 hottest metros in May was $ 374,000, 16.3% lower than the national median of $ 447,000. That’s the biggest gap between these two benchmarks since August 2021. (Metros include the central city and the surrounding suburbs, towns, and smaller urban areas.)
Homebuyers’ renewed interest in bargains is understandable, given all-time high home prices (up 17.6% over last year) combined with rising mortgage rates (now over 5% for a 30-year fixed-rate loan).
Clearly, when it comes to what makes for a desirable place to live these days, it’s all about the money.
Indiana: A state with big bargains
As home shoppers cast about for real estate deals, they found plenty to love in Indiana. Elkhart, Lafayette, and Fort Wayne made up three of the four cheapest markets in this ranking, all with average home prices below $ 300,000.
With prices like these, Indiana is attracting a growing number of homebuyers from out of state.
“Affordable housing is attractive for both local residents and also for out-of-state shoppers looking for value,” says Ratiu. “The shares of out-of-state views on Realtor.com reached 41% in Elkhart, 33% in Lafayette, and 31% in Fort Wayne, highlighting that a lower cost of living is attractive to buyers from more expensive locales like Chicago, Atlanta, Washington, DC, or St. Louis. ”
New Hampshire: Low taxes and cost of living
It’s not just cheaper housing that’s luring homebuyers — it’s also a cheaper cost of living in general. Low taxes in particular help explain why the New Hampshire towns of Manchester, Concord, and Claremont made the top 20.
“Adding to the more affordable cost of housing, living expenses are also lower in these [hottest] markets, ”says Ratiu. “In addition, New Hampshire offers the added benefit of no state income or sales tax.”
So while home prices in New Hampshire’s hottest markets might be a bit higher than Indiana, that’s not stopping buyers from snapping up properties.
“The New Hampshire housing market, like so many other parts of the country, remains very much a seller’s market. Homes are selling for over asking, ”says Link Moser, broker of Experience Homes Group. “New Hampshire has always been a tourist destination and a popular location for people to retire. The [COVID-19] pandemic and rise of remote work further fueled the demand for New Hampshire real estate. We see lots of out-of-state buyers buying second homes as well as investors looking to rent [out] homes, both short and long term. ”
Connecticut: ‘Affordable’ is all relative
While Connecticut’s hottest markets — namely Hartford, Norwich, and New Haven — tended to have higher home prices than Indiana as well, properties here were still cheap compared to those in bigger cities nearby. In particular, New Haven — where home prices average $ 357,450 — climbed 162 spots this May to land at No. 18 on our rankings.
“New Haven, CT, zoomed up Realtor.com’s hottest housing markets list over the past year owing to its relative proximity to large employment centers and more affordable housing prices,” says Ratiu. “New Haven is about halfway between Hartford and New York City, at the intersection of I-95 and I-91 highways, and on the Long Island Sound. In addition to a low unemployment rate, the city is also home to Yale University. For many buyers, an hour and a half commute into New York may be a bearable trade-off for more affordable housing. ”
How fast are homes selling in the hottest markets?
Despite lower prices found in New Hampshire, Connecticut, and Indiana, the number of homes for sale in each state remains scarce, forcing buyers to make their offers at record-setting speed.
“While demand rose strongly, the pace of new construction has been lagging, leading to faster-moving sales,” says Ratiu. “With tight inventory still expected to keep summer markets competitive, buyers can expect well-priced homes to move quickly.”
The fastest-moving market of all remains Manchester, NH (the metro that’s topped the hottest markets list 10 times in the past 12 months), where homes sold in a blink-and-you-missed nine days.
In short, to buy a home in a hot market today, buyers will need to act fast.
20 hottest housing markets in May
|Hottest Metros||Hotness Rank||Hotness Rank YoY||Median Days on Market||Median Listing Price|
|Manchester, NH||1||0||9||$ 444,900|
|Burlington, VT||2||80||11||$ 439,250|
|Portland, MN||3||1||15||$ 538,500|
|Concord, NH||4||-2||17||$ 449,950|
|La Crosse, WS||5||8||15||$ 344,450|
|Burlington, NC||6||-3||13||$ 369,450|
|Rochester, NY||7||2||10||$ 224,950|
|Elkhart, IN||8||6||18||$ 259,900|
|Lafayette, IN||9||1||17||$ 297,450|
|Fort Wayne, IN||10||-3||17||$ 279,950|
|Columbus, OH||11||1||14||$ 340,000|
|Springfield, MA||12||11||17||$ 352,500|
|Worcester, MA||13||5||15||$ 469,900|
|Hartford, CT||14||144||18||$ 362,750|
|Billings, MT||15||9||20||$ 549,500|
|Norwich, CT||16||130||22||$ 404,500|
|Kingsport, TN||17||29||25||$ 299,000|
|New Haven, CT||18||162||21||$ 357,450|
|Claremont, NH||19||163||25||$ 397,000|
|Oshkosh, WI||20||19||25||$ 302,400|