Key Facts
- ✓ Zillow's 2026 forecast shows the Northeast region contains more than half of the nation's top ten hottest housing markets.
- ✓ No cities from the Sun Belt or Midwest made the top ten list, a surprising shift from recent migration trends.
- ✓ Hartford, Connecticut, is predicted to be the hottest market with a home value growth forecast of 3.9%.
- ✓ In San Jose, California, 55.6% of home sales were above the list price as of November 2025 due to inventory shortages.
- ✓ The forecast analyzed the 50 most populous U.S. metros based on home price growth and market competition metrics.
- ✓ Buffalo, New York, ranked second after holding the top position in the previous year's rankings.
Quick Summary
The 2026 housing market is poised for a dramatic regional shift, with the Northeast emerging as the epicenter of buyer competition. According to new data, six of the nation's ten hottest housing markets are located in this region, defying recent migration patterns toward more affordable areas.
This forecast highlights a market defined by supply constraints rather than just price. While cities in the Sun Belt and Midwest have seen price moderation, Northeastern metros are experiencing intense demand, leading to bidding wars and rapid sales. The analysis suggests that for buyers in 2026, location will be less about affordability and more about availability.
The Northeast Dominates
Real estate data firm Zillow has released its predictions for the hottest housing markets of 2026, and the results show a clear regional leader. The Northeast accounts for more than half of the top ten list, a significant concentration that underscores the area's enduring appeal.
Despite high price tags, coastal cities like San Jose and New York remain in high demand. The list also includes smaller metros like Providence, Rhode Island, and Buffalo, New York, indicating that the trend is widespread across the region.
Key Northeastern markets on the list include:
"Markets are hotter where supply is more constrained. That's why you see that very pronounced cluster in the Northeast, where it can take longer to build, or it can be harder to build, or it can be more costly to build."
— Mischa Fisher, Zillow Chief Economist
Supply Constraints Drive Demand
The primary driver behind this regional dominance is inventory scarcity. Zillow defines a 'hot' market not just by sales speed, but by a combination of factors: home price growth, the frequency of price cuts, and the percentage of homes selling above the asking price.
Markets are hotter where supply is more constrained. That's why you see that very pronounced cluster in the Northeast, where it can take longer to build, or it can be harder to build, or it can be more costly to build.
This dynamic creates a stark contrast with other regions. In the Sun Belt, inventory levels are higher relative to demand, causing home prices to drop year-over-year in many areas. Conversely, the Northeast faces structural challenges in new construction, keeping supply tight and buyer competition fierce.
High Value, High Competition
Price alone does not determine a market's heat. San Jose, California, exemplifies this trend. With a Zillow Home Value Index of $1,558,466, it is one of the most expensive cities on the list. However, it ranks fifth due to exceptional market performance metrics.
As of November 2025, 55.6% of home sales in San Jose occurred above the list price. This intense competition is driven by a severe inventory drop, proving that even ultra-high-cost markets can remain fiercely competitive when supply is limited.
The data confirms that whether the home value index is low, like in Hartford ($381,760), or high, like in San Jose, the underlying issue remains the same: building is not easy, and where people want to be, supply is constrained.
The 2026 Top 10 Markets
Zillow analyzed the nation's 50 most populous metros to identify the most in-demand locations for 2026. The rankings are based on a blend of home value growth forecasts and competitive market indicators.
The complete top ten list features a mix of major coastal hubs and smaller, affordable cities, all united by tight inventory:
- Hartford, CT – ZHVI: $381,760 | Growth: 3.9%
- Buffalo, NY – ZHVI: $277,499 | Growth: 2.5%
- New York, NY – ZHVI: $704,284 | Growth: 1.5%
- Providence, RI – ZHVI: $503,409 | Growth: 3.0%
- San Jose, CA – ZHVI: $1,558,466 | Growth: 1.2%
- Philadelphia, PA – ZHVI: $378,054 | Growth: 1.7%
- Boston, MA – ZHVI: $717,711 | Growth: 1.5%
- Los Angeles, CA – ZHVI: $941,869 | Growth: 1.1%
- Richmond, VA – ZHVI: $383,275 | Growth: 2.1%
- Milwaukee, WI – ZHVI: $369,303 | Growth: 2.1%
Looking Ahead
The 2026 forecast signals a potential return to regional housing disparities. While the Sun Belt has been a haven for affordability and migration in recent years, the Northeast is reclaiming its status as a high-demand, competitive landscape.
For prospective buyers, the data suggests that patience and preparedness will be essential, particularly in markets where inventory is historically low. The trend indicates that despite economic pressures, demand in established Northeastern metros remains robust, likely sustaining a seller's market well into the coming year.
"The inventory is still strained in those areas, so you still have enough to maintain a lot of competition among buyers there."
— Mischa Fisher, Zillow Chief Economist
