The U.S. economy may go into recession in 2025. Many places will see home prices drop, but not all. Some states still have prices going up. If you buy or invest in real estate, these are the best states to watch. Here are top 10 states where prices will grow even in recession.
Why These States Are Different
In recession, most housing markets struggle, but these 10 states are strong because:
- Low Inventory:Â Few homes for sale, so prices go up.
- People Moving Back:Â After pandemic, many return to these areas.
- Affordable Prices:Â Homes still cheap for local buyers.
Top 10 States to Buy Real Estate in 2024-2025
10. Massachusetts
- Price Growth:Â Up 5% in 2024, may rise 5-6% more in 2025.
- Best Cities:Â Boston, Worcester, Springfield.
- Why Good:Â Not enough new homes, so demand high.
9. New York
- Price Growth:Â Up 6.8% in 2024.
- Inventory:Â Only 29,000 homes for sale (half of before pandemic).
- Why Good:Â Very few homes, so prices keep rising.
8. West Virginia
- Affordability:Â Average home price $166,000 (2.9x local income).
- Trend:Â More people buying homes and land here.
- Why Good:Â People return after moving South during pandemic.
7. Vermont
- Price Growth:Â Up 50% since pandemic.
- Unique Fact:Â 19% homes are second or vacation homes (most in U.S.).
- Why Good:Â Many buy homes for weekends or holidays.
6. Wisconsin
- Price Growth:Â Up 5-12% in 2024, may rise 6-7% in 2025.
- Best Cities:Â Green Bay, Sheboygan, Milwaukee.
- Why Good:Â Many people moving here since pandemic (19,000 in 2023).
5. New Hampshire
- Price Growth:Â Up 68% since pandemic (best in U.S.).
- Tax Benefits:Â No income tax, no sales tax.
- Warning: High property taxes (e.g., 7,000−7,000−8,000 per year for $450,000 home).
- Why Good:Â Close to Boston and New York, good lifestyle.
4. Rhode Island
- Price Growth:Â Up 7.1% in 2024.
- Inventory:Â Only 155 homes for sale in Washington County (was 600 before).
- Why Good:Â Very few homes, so prices go up.
3. Illinois
- Price Growth:Â Up 5.4% in 2024.
- Inventory Problem:Â 38.9% fewer homes than normal.
- Best Cities:Â Chicago, Peoria, Springfield.
- Why Good:Â Not enough builders or sellers, so demand high.
2. New Jersey
- Price Growth:Â Up 8.9% in 2024 (best in U.S.).
- Inventory:Â Only 12,000 homes for sale (down 70% from 5 years ago).
- Why Good:Â Close to New York City, very few homes for sale.
1. Connecticut
- Price Growth:Â Up 6.3% in 2024, may rise 7-8% in 2025.
- Inventory:Â Down 56% from normal levels.
- Why Good:Â Few homes and high demand make it best state for price growth.
Important Trends
- People Moving Back:Â Many who went South during pandemic now return to Northeast and Midwest.
- Old Cities:Â Cities with little new construction see prices rise because few homes for sale.
- Affordable Prices:Â States like West Virginia and Wisconsin attract buyers with cheap homes.
Risks to Know
- High Property Taxes:Â States like New Hampshire and New Jersey have big tax bills.
- Insurance Costs:Â Some areas have expensive insurance.
- Economy Problems:Â Recession can hurt jobs and buyer demand.
