BAM Key Details:

  • A new report on shares the results of the Fall 2023 Wall Street Journal/ Emerging Housing Markets Index, highlighting the top 20 emerging markets for the season. 
  • Nine markets fell out of the top 20, replaced by five Midwestern metros, three from the Northeast, and one West Coast market. 
  • Topeka, Kansas stands out at number one, rising six spots from its summer ranking. Springfield, OH climbed 46 spots to reach the top 20, outclimbing all other newcomers. 

The weather isn’t the only thing getting colder as fall transitions to winter. Buyers and sellers are already shifting their attention toward holiday preparations. And with record-low housing affordability, it’s even easier to put home purchases and sales on hold. 

Yet, while higher housing costs and historically low inventory have put an early chill on buyer demand (and more than usual for the season), homes are still selling. And lesser-known relatively affordable markets are emerging as new homebuyer hotspots.  

A new report on highlights the results of the Fall 2023 Wall Street Journal/ Emerging Housing Markets Index, including a list of the 20 markets that offer shoppers a lower cost of living (which includes housing), strong local economies, and attractive but not too crowded metro areas. 

The index is based on data for the largest 300 U.S. metro areas. Read on to see which markets made the list this fall, which markets remain from summer, and which fell off the radar. 

Fall 2023 Top 20 Emerging Housing Markets

While homebuyer activity has slowed across the U.S. demand in more affordable markets limits inventory growth, drives up housing prices, and shortens days on market for available homes. 

Buyers are still moving to areas with a lower cost of living (and housing), as shown by previous releases of the Emerging Housing Markets index. 

This year’s top 20 identifies markets today’s buyer should have on their shortlist of desirable home shopping locales, based on cost of living, economic conditions, and amenities. 

  1. Topeka, KS
  2. Elkhart–Goshen, IN
  3. Oshkosh–Neenah, WI
  4. Fort Wayne, IN
  5. Lafayette, West Lafayette, IN
  6. Racine, WI
  7. Manchester–Nashua, NH
  8. Concord, NH
  9. Columbus, OH
  10. Johnson City, TN
  11. Kingsport–Bristol–Bristol, TN–VA
  12. Jefferson City, MO
  13. Springfield, OH
  14. Santa Maria–Santa Barbara, CA
  15. Dayton, OH
  16. Janesville–Beloit, WI
  17. Canton–Massillon, OH
  18. Knoxville, TN
  19. Hartford–West Hartford–East Hartford, CT
  20. Worcester, MA

More Amenities at a Lower Cost

Though housing costs have stabilized or even declined in some areas, lower-priced markets like the ones listed above have grown in popularity, accelerating price growth and slowing the accumulation of housing supply. 

Despite that, housing prices in 15 of the Fall Emerging Housing Markets were lower than the national median of $430,000 in September. The U.S. housing market, on the whole, has not made significant progress toward affordability, so the emerging markets for Fall 2023 still stand out as relatively affordable. 

For example, in September, the lowest price market on the list—Springfield, Ohio—saved buyers 54% on the median-priced home relative to the national median. 

And cost savings aren’t the only benefit to these markets: they also tend to offer homebuyers more amenities than the average for the 300 largest U.S. metro areas.

For clarity’s sake, amenities are measured as “the average number of stores per specific ‘everyday splurge’ category (coffee, upscale/specialty grocery, home improvement, fitness) per capita in an area.” 

Today’s buyers want cost savings without compromising on comforts, and this fall’s top 20 emerging markets deliver on both. 

Price growth speedier than average as supply dwindles and homes fly off the market

For the 12 months ending September 2023, the average uptick in listing price among the top 20 emerging markets was 19%, compared to the national average of 9.5%. 

Price growth surpassed the national rate in nineteen of those top 20 markets—the exception being Springfield, Ohio. 

Compared to pre-pandemic years (2017–2019), housing prices in the top 20 were 69% higher in the third quarter of 2023, compared to 47% nationally. 

High housing demand in top markets means available homes spend less time on the market, preventing the build-up of inventory seen in other markets across the country. Year over year, inventory grew by 8% in the top 20 markets, compared to 34% across the 300 largest metros. 

Compared to 2017–2019 averages, the top emerging markets saw a 62% drop in for-sale inventory—well above the 47% national decline. 

Homes in those top 20 spent 35 days on the market in the third quarter of 2023—nearly three weeks less than the same quarter in 2017–2019. Compare that to the national difference of just 13 days, with homes spending an average of 46 days on the market in Q3 2023. 

Mid-sized markets are getting more attention

Only five of the top 20 markets for this fall have populations of more than 500,000. On average, the mid-sized metros on the list are 46% smaller than the top 300 U.S. metros. 

People living in these less-congested metros typically have commute times 5.4% shorter than the national average. The biggest metros on the Fall 2023 list are Columbus, OH and Hartford–West Hartford–East Hartford, CT, with populations of 2.2 million and 1.2 million, respectively. 

Both of those larger markets, along with three other metros on the top 20 list—including the one ranking at #1, Topeka, Kansas—are state capitals. State government job growth surpassed overall job growth this summer, boosting job markets in these metros. 

On average, the unemployment rate in the top 20 markets is 3.2%, 0.4% lower than the average for the top 300 metros and 0.6% lower than the 3.8% national average reached in September.  

Only two of those top 20 markets—Elkhart–Goshen, IN and Canton–Massillon, OH—have higher unemployment rates at 4.3% and 4.0% respectively. 

Larger U.S. metros—including Denver, CO; Seattle, WA; Dallas, TX; and Portland, OR—are among those that fell the most in the Fall 2023 rankings. 

Among those that climbed the most are smaller metros—like Jackson, MI; Trenton, NJ; and Monroe, MI—all of which have populations under 400,000. 

Typical wages for the top 20 metros are roughly equivalent to the national average. But for people living in these areas, those wages go a bit farther thanks to the lower cost of living as well as relatively affordable housing. 

On average, prices in those 20 markets are less than 94% of the national price level, though four of those 20 rise above that level, with the highest cost of living in Santa Maria–Santa Barbara, California. 

If you are an agent serving one of the emerging housing markets listed above, tune in for the Hot Sheet, where host Byron Lazine goes through the report and highlights information worth sharing with your buyers. 

If you’re serving one of those metros specifically, this is an opportunity to let people know that they can find an affordable economy, they can find an affordable home in your area. The only one that’s kind of sticking out there is Santa Maria–Santa Barbara, California. I’m assuming the $1.9 (million) there is more affordable or more attractive than the surrounding areas…The highest price points on the list after that were Manchester, NH, and Concord, NH, at $535K and $555K respectively. Everything else was in the $400s or mostly in the $300s.

Byron Lazine

If you’re outside of the top 20 but you’re thinking, “My market is pretty similar to these,” you can do a bit of local research to create a detailed comparison with your market and one of the emerging markets listed here. 

Hey, [XYX Town/Metro] didn’t make the top 20 emerging markets list. Here’s why we should have.” And list out those reasons in a long-form study for your community that you can break out for bite-size content.

Byron Lazine

Read the full report for more information, including methodology.