For the second year in a row, Buffalo, New York, has secured the top spot on Zillow's list of the hottest housing markets for 2025, earning the distinction of being the first market to secure the number one ranking in back-to-back years.

According to Zillow's analysis, which predicts the housing markets that will be the most competitive for buyers in the coming year, hot markets have spread from the Northeast, Great Lakes and South regions into the Midwest and West. The top factors that go into creating a "hot" market are relative affordability and supply that trails demand, says the analysis.

Nationwide, Zillow forecasted relatively steady growth for both home values and sales in 2025 and inventory that should be recovering from the pandemic. However, mortgage rates are expected to remain somewhat volatile.

Experts from Redfin and Fannie Mae and Pulsenomics LLC told USA TODAY in December they expect a 3.8-4% rise in the median home sale price and a 4.2-5.1% bump in home sales in 2025. They also predicted mortgage rates will continue to hover in the high 6% range.

"Construction that keeps pace with an area's growth remains a crucial piece of keeping homes available and accessible. In chilly Buffalo, competition among buyers will remain hot, with employment growing far faster than builders are adding homes," said Skylar Olsen, Zillow's chief economist, in a statement. "Shoppers nationwide should see more options for sale than in recent years, along with slow and steady price growth. That's the good news. But both buyers and sellers should expect unpredictable mortgage rates."

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Zillow's hottest housing market list methodology

Zillow's rankings are made by examining the nation's 50 most populous metros, taking into account Zillow's forecast for local home value growth and the speed at which home sellers are entering contracts with buyers. Zillow also measured typical home value, the average mortgage payment, typical rent and the average number of days a house is on the market for each city.

The analysis also includes:

• Expected value appreciation from November 2024 to November 2025
• Job growth over two years per residential building permit total
• Growth in owner-occupied households

Zillow's top 10 hottest housing markets of 2025

The primary reasons Buffalo was number one again, according to Zillow? Job and wage growth, relative affordability and demand that outweighs supply.

According to Zillow's analysis, Buffalo has the most new jobs per new home permitted – a measure of expected housing in ratio to new residents brought to the area by new jobs. It also benefits from the relative affordability both in the context of the larger market and as an alternative to the much for expensive New York City or other Northeastern cities, like Boston. Lower-than-average home prices and rent costs in Buffalo bolstered demand and helped to push it to the top spot.

Meanwhile, Zillow attributes Indianapolis’s second-place spot to its strong home price forecast for this year.

• Buffalo, NY
• Indianapolis, IN
• Providence, RI
• Hartford, CT
• Philadelphia, PA
• St. Louis, MO
• Charlotte, NC
• Kansas City, MO
• Richmond, VA
• Salt Lake City, UT

Cities that made the biggest gains

• Virginia Beach, VA: No. 13 in 2025, up 23 spots from 2024
• Oklahoma City, OK: No. 17 in 2025, up 21 spots from 2024
• Birmingham, AL: No. 20 in 2025, up 21 spots from 2024

Cities that saw the biggest losses

• Memphis, TN: No. 42 in 2025, down 30 points from 2024
• Las Vegas, NV: No. 35, down 23 points from 2024
• Tampa, FL: No. 29, down 19 points from 2024
• San Francisco, CA: No. 49, down 19 points from 2024

Contributing: Gabe Hauari, Andrea Riquier, USA TODAY