For the nation as a whole, Zillow predicted home values and sales would continue their steady rise in 2025 – subject to the vagaries of interest rates and available inventory – as part of a recovery from “a deep pandemic-era deficit.”

Indianapolis’ rank was boosted by a strong home-price forecast. It was also the only metro where home values were expected to appreciate, up from 2.8% to 3.4% in 2025. For some other metros, the positive ranking was the result of being a nearby alternative to expensive Northeastern cities like New York City and Boston.

Home value growth approached historical averages in 2024, though it slowed later in the year. In Buffalo, strong price appreciation of 5.8% in 2024 is expected to slip 2.8% this year. In Tampa, prices fell 0.8% in 2024 but are expected to grow 2.2% in the year ahead.

Inventory, however, remains scarce, despite a slight recovery last year. “Rate-lock has kept inventory from rising to pre-pandemic levels. Meanwhile, homes are typically staying on the market longer before selling,” Zillow reported. It predicted that low-inventory markets where homes sold rapidly last year will continue to see strong demand relative to supply. “The markets with the fewest listing days per home in 2024 – those where inventory was lowest and sold the fastest – were Hartford, Cincinnati, and Columbus, the same three markets as the previous year.”

Two factors affecting the market are that baby boomers are breaking past norms by staying in their homes as they age, while millennials are heading into their prime home-buying years.

Still, Zillow expects that 42 of the top 50 markets will see increased home ownership, led by Austin, Orlando and Jacksonville. Home ownership is likely to dive in Birmingham, Hartford and Oklahoma City. Other cities where weak demographic and job market pressures could precipitate falling home values are New Orleans, San Francisco, San Jose, Portland, OR, and Austin.