Where are the best cities to buy a home?
In the world of real estate, the term “buyer’s market” describes a local or regional market where there’s more housing supply than demand. Buyer’s markets have relatively affordable prices, selling price discounts, and a comparatively slow pace of home sales. Some definitions stretch to include factors like low property taxes and a high prevalence of single-family homes.
These conditions are fantastic for patient buyers who seek long-term investment opportunities and those who just want to upgrade to a better home at a reasonable price. While the rock-bottom mortgage rates we saw early in the COVID-19 pandemic are no longer with us, it’s still possible to find good deals if you know where to look.
Since they feature low prices and ample supply, buyer’s markets are particularly attractive for first-time homebuyers. And thanks to online data aggregators like Redfin, Roofstock, and Zillow, identifying and capitalizing on buyer’s markets is easier now than ever before.
Best Cities to Buy a Home in America
In no particular order, these are some of the best buyer’s markets in the U.S. right now. They’re all metropolitan areas, meaning they include one or more bigger cities and the suburbs and exurbs surrounding them. You can find the criteria we used to form this list below.
1. Cleveland, Ohio (Cleveland-Elyria-Mentor Metro Area)
- Median Home Sale Price: $112,750 (Cleveland proper)
- Selling Price Discount: -1.7%
- One-Year Change: +5.4%
- Three-Year Change: +61.0%
- Five-Year Change: +104.4%
- Median Time on the Market: 31 days
- Local Unemployment Rate: 6.7%
Even after decades of neglect, Cleveland proper and inner-ring streetcar suburbs like Shaker Heights are awash in vintage homes dating back to the first three decades of the 20th century. Many need nothing more than a fresh coat of paint and some modern finishes.
Although Northeast Ohio is dominated by heavy industry, Cleveland isn’t quite as one-note as, say, nearby Canton, the long-faded automotive rubber capital.
Thanks in large part to the presence of the Cleveland Clinic, the city’s largest private employer, it’s a world-class health care hub. Together with Case Western Reserve University and University Hospitals Cleveland, the Cleveland Clinic is a nexus for biotechnology research. NASA even has a research facility here: the Glenn Research Center, named for native Ohioan John Glenn.
2. Toledo, Ohio
- Median Home Sale Price: $115,000
- Selling Price Discount: -0.6%
- One-Year Change: +15.0%
- Three-Year Change: +47.9%
- Five-Year Change: +64.4%
- Median Time on the Market: 41 days
- Local Unemployment Rate: 4.1%
While Toledo’s post-industrial economy is subdued, nearby communities have added thousands of decent-paying jobs over the past decade. And bargain-basement land and housing prices are irresistible for real estate investors and urban pioneers who know a good deal when they see one.
Sheer affordability is what stands out the most about Toledo’s housing market. The Toledo area is home to nearly a million people, but the city’s median housing costs remain shockingly low. However, local home prices are rising quickly, so buyers may not have much time to get in on its once-in-a-generation deals.
For experienced real estate investors, plentiful fixer-upper homes beckon, many dating back to the 1910s and 1920s.
3. Philadelphia, Pennsylvania (Philadelphia-Camden-Wilmington Metro Area)
- Median Home Sale Price: $265,000
- Selling Price Discount: -1.6%
- One-Year Change: +1.9%
- Three-Year Change: +27.9%
- Five-Year Change: +55.8%
- Median Time on the Market: 39 days
- Local Unemployment Rate: 4.4%
Philadelphia is the United States’ sixth-largest city and one of its most popular tourist destinations. Among major northeastern cities, it’s by far the best value for homebuyers. You’ll get far more house for your money than in nearby Washington, D.C., or New York City.
Traffic is rough, but the public transit system provides decent coverage well out into the suburbs. If you plan to work in central Philly, there’s a good chance you’ll take the train or bus to work.
It’s not difficult to find a job in Philly thanks to a diversified regional employment base and a lively tech scene. Plus, New York City is only 90 miles away by train, and thousands of Philadelphia-area residents make that commute. The comparably low cost of housing in Philly justifies the fuel or train bill.
Closer to home, Philadelphia and nearby suburbs have a mind-boggling array of charming 19th- and early-20th-century row houses and detached homes just begging for new owners’ sweat equity.
4. Omaha, Nebraska (Omaha-Council Bluffs Metro Area)
- Median Home Sale Price: $255,000
- Selling Price Discount: +4.0%
- One-Year Change: +15.3%
- Three-Year Change: +36.4%
- Five-Year Change: +55.7%
- Median Time on the Market: Five days
- Local Unemployment Rate: 2.6%
Omaha is the largest city in Nebraska and the hub of a three-state region that includes parts of Nebraska, Iowa, and Missouri.
Finance junkies know Omaha as the home of Warren Buffett, chairman and CEO of Berkshire Hathaway and perhaps the world’s most famous buy-and-hold investor. Berkshire Hathaway’s annual shareholder meeting is one of the hottest tickets in Omaha — less a reflection of the city’s low-key social scene than the respect Buffett and right-hand man Charlie Munger command among fellow investors.
But you don’t have to buy into Buffett and Munger’s investing philosophy or even know who they are to find good deals in Omaha. The city’s real estate market is perennially peppy but never red-hot, and its aging inner-city housing stock offers innumerable fixer-upper opportunities. And because the region’s diverse economy supports one of the country’s lowest unemployment rates, you should have no trouble selling when the time comes.
5. Tulsa, Oklahoma
- Median Home Sale Price: $210,000
- Selling Price Discount: +0.3%
- One-Year Change: +9.9%
- Three-Year Change: +37.3%
- Five-Year Change: +45.2%
- Median Time on the Market: Eight days
- Local Unemployment Rate: 3.0%
Tulsa has a strong economy that shows no signs of slowing down. Dozens of energy firms have headquarters or branch offices in the city, so it has benefited greatly from the ongoing shale gas boom. Tulsa’s location near one of the world’s largest energy terminals in Cushing, Oklahoma, helps too.
Meanwhile, the city is a jumping-off point for tourists looking to escape to the Ouachita Mountains and the nearby lake district of northeastern Oklahoma and southwestern Missouri. Both regions offer amazing recreation opportunities, including a world-class long-distance hiking trail.
While opportunistic buyers might be wary of a market that has posted strong price increases during each of the past five years, Tulsa remains incredibly affordable by national standards. If history is a guide, that’s not likely to change anytime soon.
6. Rockford, Illinois
- Median Home Sale Price: $123,500
- Selling Price Discount: +0.0%
- One-Year Change: +23.5%
- Three-Year Change: +38.4%
- Five-Year Change: +51.8%
- Median Time on the Market: 14 days
- Local Unemployment Rate: 8.5%
Rockford is located less than 100 miles from downtown Chicago, but it bears little resemblance to the Windy City. Rockford is a growing hub for the insurance industry and has had some success in attracting high-tech manufacturers.
Two of the Midwest’s busiest interstate highways meet in Rockford, so the city is also a noteworthy trucking hub.
Rockford’s housing market has recovered nicely from the late-2000s recession. Homeowners who bought at what turned out to be the market’s rock bottom in 2013 and 2014 have seen their investments appreciate by well over 100% on average. Given that prices are far lower than the national average, it stands to reason prices could continue to rise.
7. Des Moines, Iowa (Des Moines-West Des Moines Metro Area)
- Median Home Sale Price: $182,250
- Selling Price Discount: -0.5%
- One-Year Change: +3.0%
- Three-Year Change: +27.0%
- Five-Year Change: +44.8%
- Median Time on the Market: 14 days
- Local Unemployment Rate: 3.1%
Like Omaha, Des Moines is the largest city in a small Midwestern state and a regional hub for a predominantly agricultural hinterland. Also like Omaha, it’s home to a surprisingly diverse and robust economy, though it doesn’t count any billionaire investors among its hometown heroes.
Des Moines is the state capital of Iowa, with all the steady state tax revenue that entails. It’s also home to multiple major insurance and financial services firms, including Principal Financial Group, Wells Fargo, Voya Financial, Nationwide Mutual Insurance Company, and Wellmark Blue Cross Blue Shield.
Thanks to low living costs and relatively cheap electricity, Des Moines also has a growing data center industry anchored by names like Microsoft and Facebook.
Despite all this, Des Moines’ housing market remains affordable. Relatively low land costs and gentle topography make it easy to build cheap tract housing on the cornfields ringing the metropolitan area. And the city’s early 20th-century urban housing stock offers plenty of bargains for owner-occupants too.
8. Albuquerque, New Mexico
- Median Home Sale Price: $300,000
- Selling Price Discount: +2.4%
- One-Year Change: +17.6%
- Three-Year Change: +46.1%
- Five-Year Change: +57.8%
- Median Time on the Market: 13 days
- Local Unemployment Rate: 4.1%
Albuquerque offers a solid sale price discount and steadily appreciating list prices. A high foreclosure rate sweetens the deal for buyers who want to flip houses.
Outside its southeastern oil patch, New Mexico’s rural economy seems locked in perennial decline. In Albuquerque, though, things are looking better than they have in a long time.
The University of New Mexico and several major health care companies support a booming knowledge economy. And the city’s beautiful surroundings and unique culture make it an increasingly popular tourist destination.
9. Indianapolis, Indiana (Indianapolis-Carmel-Anderson Metro Area)
- Median Home Sale Price: $222,250
- Selling Price Discount: +1.1%
- One-Year Change: +20.1%
- Three-Year Change: +45.8%
- Five-Year Change: +76.7%
- Median Time on the Market: Five days
- Local Unemployment Rate: 2.5%
Affectionately known as “Indy,” Indianapolis is bigger than Detroit, St. Louis, and Milwaukee — and most other Midwestern cities for that matter. That’s due to a steady annexation campaign that has folded many Indianapolis suburbs into a consolidated city-county government.
That means you don’t have to spring for a pricey downtown condo or trendy row house if you want to live in Indy proper. The city has a vast stock of newer suburban-style houses — many offering single-level living — on relatively large lots. And they’re a steal compared with comparable properties on the outskirts of pricier cities.
Once you’re in town, you shouldn’t have much trouble finding work. Indianapolis has a diverse economy supported by dozens of big transportation employers, major health insurance companies like Anthem, pharmaceutical firms like Eli Lilly and Company, and agribusinesses like Corteva.
10. Hartford, Connecticut (Hartford-West Hartford-East Hartford Metro Area)
- Median Home Sale Price: $229,750
- Selling Price Discount: +0.5%
- One-Year Change: +12.1%
- Three-Year Change: +34.1%
- Five-Year Change: +43.3%
- Median Time on the Market: 57 days
- Local Unemployment Rate: 4.2%
Located near the geographical center of Connecticut, Hartford is a hub for the global insurance industry. It’s home to a sizable aerospace cluster (anchored by Raytheon Technologies, which has a major presence in nearby Farmington), and is the state capital to boot.
The city’s relatively diverse economic base keeps it in better shape than other rusting New England factory towns. In central-city neighborhoods, much of the housing stock dates to the late 19th and early 20th century — catnip for DIYers who know what they’re doing.
Elevated property values in newer, perennially desirable suburbs like Farmington, Bloomfield, and Vernon help boost the metro average.
Hartford is one of the only metros on this list that didn’t see significant price appreciation during the past five years, making it a compelling choice for value-hunting homebuyers.
The roughly equal-sized cities of New Haven (home to Yale University) and Springfield, Massachusetts, lie well within Hartford’s commuter belt — all the more reason to set up shop in this still-affordable pocket of New England.
Criteria That Affect Real Estate Affordability
Real estate professionals use various metrics to classify buyer’s markets and help their clients find the best places to live. Each figure tells prospective buyers something about the overall strength and affordability of a given real estate market.
- Median Home Price. The median home value for homes sold within the metro area determines whether homeownership is affordable for middle-class homebuyers.
- Selling Price Discount to List Price. In true buyer’s markets, homes usually sell for less than their asking prices. Areas where homes sell at a discount are noted by a minus sign followed by a percentage. Areas where homes sell for more than their list prices are noted by a plus sign followed by a percentage. It has been routine for homes to sell over list price since the COVID-19 pandemic, even in buyer’s markets.
- One-Year Change. The change in median home prices over the preceding 12 months is a good indicator of the market’s overall price momentum. Rapidly appreciating prices indicate a buyer’s market may soon be ending. Falling prices may indicate an ongoing buyer’s market. You can avoid getting stuck in a falling market by looking at the overall one-, three-, and five-year price trends. When the rate at which prices have fallen appears to be slowing, you can be more confident you’re getting in near the bottom of the market.
- Three-Year Change. This figure measures price momentum over a longer period and hints at the overall strength of a buyer’s market. Since the national home price average has risen slightly over the past three years, markets that post a drop may be undervalued — and therefore may be good candidates for opportunistic buyers.
- Five-Year Change. This longer-term metric shows how home prices have fared since the depths of the financial crisis and recession. While most buyer’s markets have posted price drops during this period, markets with substantial drops may have structural or economic issues that could get in the way of any price recovery. Be wary of such markets.
- Median Time on the Market. This represents the average amount of time that elapses between a home’s listing date and closing date in each market. Lower figures indicate elevated demand for homes. Buyer’s markets tend to have larger time-on-market figures.
- Local Unemployment Rate. The unemployment rate is a good indicator of a metro area’s potential for job growth and overall economic health. Economically strong regions with elevated housing supply figures, slow sales rates, and falling prices may soon turn the corner, creating lucrative opportunities for homebuyers who time their purchases just right. (This data comes from the U.S. Bureau of Labor Statistics.)
Statistics are current to the first quarter of 2022 or the fourth quarter of 2021. All home pricing and sales data are courtesy of Redfin, Roofstock, and Zillow.
Housing market affordability isn’t the only factor that should inform your next move. Good schools, vibrant culture, ample lifestyle amenities, low cost of living, low crime rates, and plentiful job opportunities are critical elements of any moving decision.
Buyer’s markets don’t last forever, so if you’re thinking of investigating these particular ones, do so before they disappear. And don’t limit your search only to these U.S. cities. You can find buyer’s markets across the United States, from big cities like Dallas, Chicago, and Houston to the surprisingly affordable fringes of Atlanta, Denver, and San Diego.