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n 2025 the U.S. housing market remained tight, yet a handful of smaller metros—mostly in the Midwest—offered buyers a realistic path to ownership. These “refuge markets” saw the strongest price gains of the year, driven by budget‑conscious shoppers who could still afford homes there, unlike in larger, pricier cities where high prices and 6%‑plus mortgage rates pushed many out of reach.
Realtor.com senior economist Jake Krimmel notes that the shift toward these affordable metros is reshaping national demand. Since mortgage rates climbed above 6% in 2022, many lower‑income buyers have moved “down‑market,” targeting cities 20–30% below the national median to offset financing costs.
**Top refuge markets**
| City | Year‑over‑year price per square foot | Median price (Nov) | Notes |
|------|-------------------------------------|--------------------|-------|
| Grand Rapids, MI | +5.5% | $389,900 | 25k below national median |
| St. Louis, MO | +5% | $291,900 | 25% of LA median, strong out‑of‑state interest |
| Cleveland, OH | +4.5% | $250,000 | 63% of households can afford the median home |
| Milwaukee, WI | +4.2% | – | 21% rise since 2022 |
| Pittsburgh, PA / Buffalo, NY / Louisville, KY | +3.7% | – | Tied for fifth |
| Providence, RI | +3.4% | – | – |
| Cincinnati, OH | +2.9% | – | – |
| Virginia Beach, VA | +2.1% | – | – |
Grand Rapids led with the largest YoY increase in price per square foot, while St. Louis attracted buyers from California, New York, Chicago, and Denver, thanks to its lower cost, solid schools, and vibrant culture. Cleveland’s affordability drew 12.2% of recent buyers from other states, many citing the ability to purchase larger homes at lower monthly costs. Milwaukee and Pittsburgh also benefited from significant price appreciation relative to 2022.
Krimmel explains that these markets illustrate how families adapt when traditional affordability pathways narrow. In a high‑rate, high‑price environment, demand shifts to metros where the math still works, reshaping the U.S. housing geography.
**National market trends**
* Inventory rose 12.6% YoY in November, the 25th consecutive month of growth, but at a slower pace.
* The median list price fell 0.4% to $415,000.
* The Midwest, the refuge market hub, saw a 1.7% YoY price increase.
* Homes stayed on the market an average of 64 days—20 months in a row longer than the previous year—especially in the well‑supplied West and South, while the Northeast and Midwest remained competitive.
These dynamics underscore a cooling national market, but also highlight the resilience and appeal of smaller, affordable metros that continue to attract buyers seeking value and equity.
