The real estate market showed signs of recovery in February 2025, marking a shift from the recent slowdown.
As spring approaches, a wave of new listings is attracting more homebuyers, signaling increased market activity.
Zillow predicts that competitively priced and well-marketed homes will sell within about two weeks in March.
While this is slower than the peak sales pace during the COVID-19 pandemic when interest rates were at record lows, it’s still a fairly quick turnaround. In some cities, homes may sell even faster.
Certain housing markets are heating up faster than others, driving up home values.
Zillow identified five U.S. cities that saw the largest month-over-month home price increases from November to December 2024. If current trends hold, these markets could continue to push prices higher in 2025.
Based on Zillow data and cost-of-living figures from PayScale, here are the five cities where home values have climbed the most:
5. Minneapolis
- Home value increase: 0.5% month-over-month
- Cost of living: 6% lower than the national average
- Housing costs: 15% lower than the national average
- Utilities: 4% lower than the national average
- Groceries: On par with the national average
4. Salt Lake City
- Home value increase: 0.5% month-over-month
- Cost of living: 10% higher than the national average
- Housing costs: 28% higher than the national average
- Utilities: 7% lower than the national average
- Groceries: On par with the national average
3. Cleveland
- Home value increase: 0.5% month-over-month
- Cost of living: 9% lower than the national average
- Housing costs: 21% lower than the national average
- Utilities: 5% lower than the national average
- Groceries: On par with the national average
2. Louisville, Kentucky
- Home value increase: 0.7% month-over-month
- Cost of living: 5% lower than the national average
- Housing costs: 19% lower than the national average
- Utilities: 15% lower than the national average
- Groceries: On par with the national average
1. San Jose, California
- Home value increase: 0.8% month-over-month
- Cost of living: 78% higher than the national average
- Housing costs: 222% higher than the national average
- Utilities: 47% higher than the national average
- Groceries: 15% higher than the national average
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