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It may be one of the snowiest cities in America, but Buffalo, N.Y., will be the hottest housing market this year, according to a new report from Zillow.
The real-estate company analyzed the top 50 metro areas in the U.S. and looked at a number of factors to determine the “hottest” market.
That includes expected home-value appreciation from December 2023 through November 2024, the availability of jobs, the speed at which homes are selling and other factors.
Buffalo rose to the top of the list based on how relatively cheap homes are there and the city’s strong job prospects. The typical home in Buffalo is currently valued at $248,445, according to Zillow’s estimates, while the national average is $347,415. If a buyer put 5% down on a typical Buffalo home, the monthly mortgage payment would be $1,792.
One of the key measures that Zillow used to gauge expected demand for housing in Buffalo was the number of new jobs being created in the area relative to the number of homes being built.
Buffalo has the highest number of jobs per new housing unit among all 50 of the cities Zillow measured, the company noted. With more jobs, competition for housing is expected to heat up and drive home prices upward, Zillow said, unless enough new homes are built to meet that demand.
Buffalo is, of course, known for its intense winters. Over the 2022-23 period, Buffalo received 133.6 inches of snow, according to the National Weather Service.
“Although our temperatures are cold, our market is not,” Vienna Laurendi, president of the Buffalo Niagara Association of Realtors and an associate real-estate broker with Howard Hanna Real Estate Services, told MarketWatch.
Of late, that’s increasingly the case, said Laurendi, with a nod to both seasonality and declining mortgage rates. “Buyers are definitely coming back now that the holidays are over,” Laurendi said.
See: U.S. mortgage rates nudge higher, but Freddie Mac expects rates to ‘drift downwards’ into the year
Buffalo, alongside Rochester and Syracuse, was recently designated as a federal technology hub and is slated to receive billions of dollars in federal funding. The money is to be used to build the region into a semiconductor manufacturing hub.
Andrew Cuomo, the Democratic former governor, launched a separate multibillion-dollar effort called the “Buffalo Billion” to revitalize the area’s economy. The city is also a college town, as home to two SUNY institutions, the University of Buffalo and Buffalo State University, as well as the private Canisius University and others. It’s also home to the Buffalo AKG Art Museum, formerly known as the Albright-Knox Art Gallery, and the storied NFL team the Buffalo Bills
“We have a lot of energy in both the city of Buffalo and the city of Niagara Falls,” Laurendi, a Buffalo native, said.
Laurendi noted that Buffalo also has a large medical campus, which not only means property buyers from the medical community but also from supporting organizations.
“We are the biggest little city in the United States,” she said.
Laurendi observed that there is significant opportunity for more new homes to be built in the city. “We have an awful lot of underutilized land” and “older infrastructure and older buildings that are just begging for revitalization, and that is what our developers today are looking at,” she told MarketWatch.
Some of that involves looking at old factories and other disused structures, Laurendi added, which “have significant fantastic character and can be revitalized into something fabulous.”
Other ‘hot’ housing markets of 2024
Not far from Buffalo, the Midwest cities Cincinnati and Columbus, Ohio, and Indianapolis claimed the second, third and fourth places on Zillow’s list of hottest markets, with affordable homes in those cities also a key factor.
Similar to Buffalo, home prices in Cincinnati and Columbus are lower than the national average — around or below $300,000 in both Ohio markets, and the mortgage payment for a buyer putting 5% down on a typical property would be less than $2,200 a month.
“Inventory is moving extremely quickly in Cincinnati, and Columbus is home to the fastest expected rise in owner-occupied households, an indication of family formation and population growth,” Zillow said.
Cheaper markets give young people a ‘real shot at buying’
Midwestern cities have dominated real-estate lists for the past year, due to affordable homes, among other factors, including, in some cases, a slower pace of life.
“Housing markets are healthiest where affordable home prices and strong employment are giving young hopefuls a real shot at buying and starting to build equity,” said Anushna Prakash, data scientist for Zillow Economic Research.
Last year’s hottest housing market was Charlotte, N.C., according to Zillow. That city fell to seventh place in 2024.
