Midwest and Northeast cities rise in the rankings this year as affordability issues grow

SEATTLE, Dec. 21, 2022 /PRNewswire/ -- Prairie Village, Kansas, was Zillow®'s most popular market of 2022, showcasing rising interest in the Midwest and headlining a dramatic shift from 2021's predominantly West Coast leaders. 

Grand Rapids, Michigan, won out for most popular large city, while top vacation, seaside and small towns were found in the Northeast. Florida won out for favorite retirement towns, and Tempe, Arizona, retained its title as the top college town. 

Using Zillow page-view traffic, available housing inventory, price appreciation, sales data and other housing metrics that indicate consumer demand, Zillow analyzed thousands of ZIP codes within the nation's 100 largest metropolitan areas to create a ranking of the site's most popular U.S. cities.

"The most popular places on Zillow showcase a few trends we've noticed over the course of the year — most notably that affordability has become the chief driver of the market. The Midwest and most Northeastern markets saw relatively small run-ups in home values over the course of the pandemic, and now are still affordable enough for residents to shop in," said Anushna Prakash, economic data analyst at Zillow.

A shift from fully remote to hybrid working situations may also be a factor. While the percentage of employees working remotely all or most of the time is lower than in the early pandemic, the share working from home at least some of the time is now much higher, according to Pew Research. This may help explain the higher popularity in 2022 of vacation spots and small towns within a somewhat reasonable, occasional commute to downtown employment centers. 

Most popular on Zillow overall: Prairie Village, Kansas

An upscale suburban community just minutes from downtown Kansas City, Prairie Village was pushed to the top of Zillow's popularity rankings with site-leading page views of for-sale listings per day. Established on the Kansas-Missouri state line and featuring a number of activity-filled parks, posh shops and restaurants, Prairie Village was also tops on Zillow's popularity rankings for small towns. 

"I think when most people are looking at houses, they are looking at building a home, and that goes beyond the four walls of the structure you live in and expands to the community," said Earvin Ray, owner of Ray Homes in Kansas City. "Prairie Village offers the trifecta of beautiful homes, a spectrum of accessible price points and great amenities, such as highly rated schools, community events and local shopping."

The Kansas City metro area is one of a host of Midwest markets still seeing robust competition for houses because they're relatively affordable. Mortgage costs as a share of income and the years needed for renters to save up for a down payment are far lower than the national average.  

Rounding out the top three are Derry, New Hampshire, a charming New England town less than 45 minutes from downtown Boston; and Bon Air, Virginia, a small residential community near Richmond with historic Victorian cottages lining its main road. 

Most popular large city: Grand Rapids, Michigan

Grand Rapids, Michigan, topped the popularity chart among cities with populations greater than 200,000, driven by category-leading page views per listing and relatively affordable homes. A wide selection of breweries and a growing local foodie scene are putting Grand Rapids on the map for connoisseurs.  

Richmond, Virginia — still a very competitive area for home buyers — landed in second place, and Omaha, Nebraska, took third. The three top results led the category for page views per listing, and all feature typical home values significantly lower than the national average of $357,733. 

Most popular seaside town: Beverly, Massachusetts

This Boston suburb features miles of coastline and easily accessible public parks, helping to make it Zillow's most popular seaside town¹ in 2022. Top rankings for page views and relatively low home values compared to its competition helped propel Beverly to the crest of the category.

Gloucester, Massachusetts, and Newport, Oregon, (the most popular beach town in 2021) ranked second and third for similar reasons. 

Most popular retirement town: Dunedin, Florida

With Dunedin's location on the Gulf Coast west of Tampa, along with local access to plenty of waterfront parks and country clubs, its popularity as a retirement town² is easy to understand. 

Florida is home to the top three cities in the category, with Sarasota placing second, and St. Pete Beach in third. Demand for homes has surged in Florida throughout the pandemic, as the state is both a sunny, relatively affordable locale and a prime retirement destination, and it has stayed hot as expensive Western markets cooled in 2022. 

Most popular small town: Windham, New Hampshire

Windham, a bedroom community outside Boston, scored highest on Zillow's index after Prairie Village. Typical home values of $738,574 in Windham are higher than the Boston metro ($643,642). Zillow defined "small towns" as cities with populations between 15,000 and 25,000. 

Hockessin, Delaware, located outside Philadelphia, followed Windham for third. 

Most popular vacation town³: Lavallette, New Jersey

A popular summer vacation destination for dwellers of nearby New York, Lavallette features long, sandy beaches for swimming, surfing and fishing in the Atlantic; space for bocce, tennis and rollerblading; and opportunities for crabbing, sailing and other water sports in Barnegat Bay. It's also a hot spot for retirees.

Indian Rocks Beach, Florida, and South Lake Tahoe, California, followed Lavallette in Zillow's results. 

Vacation areas have seen a surge in popularity over the course of the pandemic as remote work makes them viable for visits longer than just weekends and holidays. Applications for mortgages in vacation areas rose 30% from 2019 to 2020, with activity concentrated around mountains and coasts, according to a Zillow analysis of Home Mortgage Disclosure Act data.

Applicants for vacation home mortgages across the U.S. had more than twice the median household income as applicants for primary homes — $170,000 versus $79,000 — and skewed much older than applicants for primary homes, with the majority of second-home applications coming from Gen Xers and Boomers, the analysis found.

Top college town: Tempe, Arizona

Part of the Phoenix megaplex, Tempe is home to Arizona State University. Reigning as Zillow's top college town⁴ for the second year in a row, the city is home to the second-highest total number of rental listings among college towns studied, after Cambridge, Massachusetts, and has one of the largest populations of undergraduate and graduate college students.

Smithfield, Rhode Island, where Bryant University is located, came in second place; while Bowling Green, Ohio, home of Bowling Green State University, landed third. 

¹  Listing description data was included in index scoring for the "most popular seaside town" category. Zillow defined "seaside towns" as areas where more than half of listings mentioned the beach, and excluded all cities that don't feature the word "beach" in at least 50 listings on Zillow.
² Using the latest available U.S. Census data, Zillow defined "retirement towns" as areas where at least 33% of the population is over the age of 65 and has no children or other relatives (other than a spouse) living in the home.
³ Zillow defines "vacation towns" as areas where more than 33% of the housing units are designated for non-primary use. Based on 2021 American Community Survey data.
⁴ In this analysis, "college towns" are defined as cities with the share of an area's population of college students at least 20% or more based on 2021 U.S. Census data; also used were ZIP code–level populations, aggregated to the city level.

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SOURCE Zillow