The days of snagging a budget home in Cleveland, Milwaukee or other affordable housing hubs around the country may be gone forever.
New data from Redfin reveals that home prices in some of these markets are rising at breakneck speed, leaving locals and hopeful buyers scrambling for something within their means.
Cleveland leads the pack, with home prices rising 15% in the year leading up to December 2024 — the biggest increase among the nation’s 50 largest cities.
Milwaukee (14.5%), Philadelphia (14%), Miami (11.8%) and Chicago (11.1%) are close behind, as double-digit price increases hit cities once celebrated as havens for more affordable living.
Nationwide, home prices rose in all 50 largest metro areas for the first time since May 2022, with the typical home now costing $427,670.
Redfin economist Elijah de la Campa explained the change, saying, “Affordable housing has become increasingly difficult to come by; even places that saw price relief last year, like Texas and Florida, are now seeing price increases.”
Cleveland’s hot housing market is emblematic of this trend.
“Many sellers have a very specific number in mind because they saw their neighbor sell for $40,000 over asking price during the pandemic,” Bonnie Phillips, a Redfin Premier agent in Cleveland, said in the study. “They’re willing to walk away if they don’t get that number, which is one factor that keeps prices high.”
For buyers, this means dashed dreams of charming homes in sprawling suburbs.
Phillips added, “Cleveland may still have a reputation as an affordable housing haven among out-of-state residents, but not so much among locals. Many families have been paid off and those who can still afford to buy have to move to neighborhoods they don’t want to live in.
“Their dream of having a beautiful farmhouse on 1.5 acres has shifted to the reality of a tiny house in an urban area.”
The rise in prices comes as buyers adjust to high mortgage rates, which currently hover around 7%. Redfin reports that the combination of high borrowing costs and tight inventory is driving growth, even as affordability remains tight.
Meanwhile, former COVID-era hotspots like Florida and Texas are seeing more modest price increases.
Tampa posted the smallest gain among major cities at just 0.5%, followed by Orlando (1.3%), Jacksonville (1.3%), Austin (1.5%) and San Antonio (1.6%).
These states have been building homes at a rapid pace, which has helped moderate rising prices. But Florida’s housing market faces additional headwinds as buyers shy away, citing rising insurance premiums and climate risks.
Combined with the already high cost of homes, demand in the Sunshine State is cooling.
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