Smaller Midwestern metros outpaced coastal hubs as price growth cooled
Youngstown, Ohio, emerged as the nation’s hottest housing market in Cotality’s latest Home Price Index, outpacing the usual coastal and Sun Belt contenders.
The November 2025 data showed double‑digit annual gains in several smaller Midwest and Northeast hubs even as national appreciation nearly flatlined.
Cotality’s “Top 10 hottest markets” chart put Youngstown in first place (13.6%), followed by Fond du Lac, Wisconsin (11.8%); Kokomo, Indiana (11.1%); Glens Falls, New York (9.7%); Peoria, Illinois (8.8%); Sandusky, Ohio; Cape Girardeau, Missouri; Yakima, Washington; Grand Island, Nebraska; and Decatur, Illinois. These metros all logged some of the strongest year‑over‑year price gains in the country, according to the index.
On the other hand, the “coolest” markets were dominated by Texas and Florida. Victoria, Texas (-10.4%), led the list of fastest‑declining metros, ahead of Champaign, Illinois; Wichita Falls, Texas; several Gulf Coast and central Florida markets; and Dalton, Georgia, which rounded out the bottom 10.
National prices stalled, but outlook brightened
Nationally, Cotality’s bar chart showed home prices up just 1% year over year in November 2025, with a forecast for roughly 4% growth over the coming year – near the low end of the long‑run average.
The firm also reported that price growth had fallen to a 14‑year low in late 2025, even as states such as Wyoming, New Jersey, Nebraska, Illinois and Connecticut topped its list for annual gains.
“Looking ahead to 2026, regional differences will remain pronounced, with demand favoring areas that offer both economic opportunity and relative affordability,” said Cotality chief economist Dr. Selma Hepp.
Hepp added that if mortgage rates declined, “we could see renewed momentum in the spring, spurring increased competition among buyers and potentially driving a re‑acceleration of price gains in markets with limited inventory,” a dynamic that could be particularly acute in tighter Midwestern metros.
Washington, D.C., which Cotality cited as the second‑fastest‑depreciating market, was linked by the firm to early federal “DOGE initiatives,” a connection that has yet to be substantiated by other data sources.
What this meant for lenders and originators
Outside Cotality’s research, other forecasters pointed to a slowly improving but still stretched affordability backdrop. Fannie Mae projected that the 30‑year fixed mortgage rate would average about 6.2% in early 2026 before slipping below 6% by year‑end, with national home price growth easing toward roughly 1.3%.
Mortgage Bankers Association chief economist Mike Fratantoni said more markets are shifting toward buyers as supply gradually improved.
“I think in more and more markets around the country, it's going to be a buyer's market as opposed to a seller's market that it’s been for a number of years,” he said, adding that borrowers would have “more leverage in the transaction than we've seen for some time.”
2026 affordability projections highlighted similar themes, noting that while housing costs remain far above pre‑COVID norms, affordability has improved year over year for seven consecutive months and is “now sailing in the right direction,” according to First American’s Odeta Kushi and Mark Fleming.
Takeaway for mortgage professionals
The story behind Cotality’s maps is less about a single “hot” city and more about dispersion. Rust Belt and interior‑West markets such as Youngstown and Grand Island that still offered relative value began to attract fresh demand even as once‑booming Florida and Texas metros cooled.
At the same time, national forecasts pointed to only modest price gains and slowly easing rates rather than a sharp correction.
In that environment, 2026 looks set to reward lenders and brokers who lean into granular, local data – identifying pockets of resilience like Youngstown while helping rate‑sensitive borrowers navigate slowly improving affordability rather than waiting for a broad market reset.
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