Realtor.com® 2023 Hottest ZIP Codes in America Reveal Demand for Closer Commutes is Back
Affordability isn’t the only priority for U.S. homebuyers, according to Realtor.com®‘s ninth annual Hottest ZIP Codes report; Proximity to cities is key as many companies call workers back to the office
For the first time in five years, the suburbs of five major metropolitan areas – Boston, New York, Chicago, Detroit and St. Louis – are represented on the annual Realtor.com® Hottest ZIP Codes Report, marking a renewed interest in commutable homes as much of the country’s workforce returns to in-person work. Americans who have been shopping for a home in 2023, despite limited inventory and high mortgage rates that remain in the 6-7% range, are flocking to areas that are more affordable relative to the rest of the country, less expensive than their nearby metro area, or provide better value, offering more space at a lower price.
Located exclusively in the Midwest and the Northeast, each of this year’s top 10 Hottest ZIP codes in America is attracting buyers with homes that are either priced at or below the U.S. median, or are larger in size than the U.S. average. Additionally, homes listed within the Hottest ZIPs received an average of 3.6 more views per listing than in the rest of the country, and sold one month faster than average in 2023.
The 2023 Hottest ZIP Codes in America, in rank order, are:
- 43230, Gahanna, Ohio
- 06489, Southington, Conn.
- 07450, Ridgewood, N.J.
- 01810, Andover, Mass.
- 18064, Nazareth, Pa.
- 46322, Highland, Ind.
- 48183, Trenton, Mich.
- 06851, Norwalk, Conn.
- 14534, Pittsford, N.Y.
- 63021, Ballwin, Mo.
“As many companies continue to call employees back to the office, we’re seeing a surge in home shoppers who are seeking a desirable combination of cost and convenience within commuting distance of major metropolitan areas,” said Danielle Hale, Chief Economist for Realtor.com®. “In addition to affordable markets, this year’s list also features some higher priced areas close to large urban cores, which will likely appeal to buyers who are concerned with finding the right mix of size and amenities within reach of a nearby city center.”
No. 1 Hottest ZIP: Gahanna, Ohio
This year’s Hottest ZIP Code is Gahanna, Ohio (43230), which continues the legacy of Columbus, Ohio markets appearing on the Hottest ZIP codes list. The greater Columbus area offers home buyers the amenities and quality-of-life advantages of a larger town, but at a lower price. It’s home to The Ohio State University, the Short North Arts District as well as a captivating food scene. Homes in this ZIP code were priced 12.7% below the national median in June – and with more than a quarter of its population aged 25-34, it’s favorable for young renters and buyers alike.
Suburban space, closer commutes draw home shoppers
Looking more closely at this year’s hottest ZIPs, No. 3 on the list, Ridgewood, N.J. (07450), is a high-priced suburb of New York City that offers an idyllic setting with typical listings that are more than double the size of those in the NYC metro and is just a one-hour commute from Manhattan. Shoppers are willing to pay up for these amenities, and homes in the area have a price-per-square-foot that is 7.9% higher than the metro’s average. Residents of this year’s No. 4 ZIP on the list, Andover, Mass. (01810), a suburb of Boston, can commute to the city in under an hour, and the area also boasts larger homes priced 25% lower per square foot than Boston listings. The typical home in No. 9, Pittsford, N.Y. (14534), was 29.3% larger than the median-sized home in the surrounding Rochester metro, less than 30 minutes from the city center by car, and despite the premium to live in this desirable village, listing viewership was more than 30% higher than the surrounding metro. Finally, Ballwin, Mo. (63021), at No. 10 on the list, is similar to these Northeast locales in that listing prices in the area tend to be higher than the metro average, but homes for sale were upwards of 30% larger than the metro’s median home size.
Big-city dwellers are driving demand
Six of this year’s Hottest ZIP codes – generally those found near big-cities – drew the majority of their property views from within their metro area, suggesting that in many areas, buyers are looking to move around locally. Additionally, those areas seeing significant interest from other locations are typically seeing it come from big-city shoppers. Reflecting this trend, No. 1 ranked Gahanna, Ohio (43230) captured the largest share of out-of-metro viewership among the Midwest metros, drawing 13.1% of its viewership from the New York City area in the second quarter of 2023. In fact, New York City was the top out-of-market viewer for seven of the 10 hottest zips.
Size matters: nearly all Hottest ZIPs feature more space
In seven out of 10 of this year’s Hottest ZIP codes, the typical home is larger than the average home in the surrounding metro area. Among the more expensive locations on the list, the typical household size is also larger, indicating that home shoppers in places such as Ridgewood, N.J. (07450), Andover, Mass. (01810) and Pittsford, N.Y. (14534) may be shopping for more space to accommodate a larger family. This is particularly true in Ridgewood, N.J. (07450), the most expensive ZIP on this year’s list, where the typical household is 19.7% larger than the U.S. average of two-and-a-half people per household.
Homebuyers want affordability
Recent near-record high mortgage rates and still-inflated listing prices continue to create affordability challenges for homebuyers, resulting in buyer demand in areas that boast affordability. Seven of the top 10 Hottest ZIP codes offer home prices that are similar or lower than the U.S. median listing price or the prices in their surrounding metropolitan area. Notably, the Midwest saw a post-pandemic boom, as traditionally popular metros became unaffordable and many home buyers looked for value in new locations. Four major Midwest markets on this year’s list are close to city centers, including Columbus, Ohio (43230 No. 1 Gahanna), Chicago, Ill. (46322 No. 6 Highland, Indiana), Detroit, Mich. (48183 No. 7 Trenton, Michigan) and St. Louis, Mo. (63021 No. 10 Ballwin, Missouri). These markets offer homebuyers prices that are 24.7% lower than the U.S. median, as well as a strong local economy and employment rates below the national average.
From hot to not: West, South left out
Only the Northeast and Midwest are represented in this year’s ranking, the first time in the list’s history that only two regions are included. The South and West regions are not represented among this year’s rankings, leaving out regions of the country that have typically contributed several markets to the list. Back in 2017 the South and West accounted for more than half of the Hottest ZIPs, and in both 2018 and 2019, these regions accounted for at least half of the top 10. High prices in the West and high price growth during the pandemic in the South are likely contributing to the shift.
Among the top 10, buyers need to be prepared and move fast
Despite the overall housing market starting to cool, with the average home in the U.S. spending about 45 days on the market, homes in this year’s Hottest ZIP codes spent just 10 to 25 days on the market and saw three times more visitors per property on Realtor.com® in June. With inventory falling 22.4% in these ZIP codes compared to a 7.1% increase nationally, those looking to buy in these markets are facing tough competition.
“Shoppers in this year’s Hottest ZIP codes should cope by being prepared – pre-approved and zeroed in on their budget and down payment – and really focused on must haves versus nice-to-haves so they can be ready to act quickly when they see the right home hit the market,” said Realtor.com® Economic Research Analyst Hannah Jones. The high price of financing a home purchase this year and still-steep competition meant successful buyers in the hottest markets also came with exceptional qualifications, with an average credit score of 754, surpassing the U.S. average of 740. Additionally, they made higher than average down payments, reaching 17.2% compared to the national average of 12.3% in the first half of 2023.
One way to stay ahead of the competition in America’s hottest ZIPs is to set a price alert on Realtor.com®. Simply enter your search criteria and save the search to get real-time or daily notifications when homes matching your search criteria hit the market. Additionally, if you are searching for homes in other hot areas, be on the lookout for Realtor.com® Hot Market badges on neighborhoods and home listings for insights about how fast homes are selling and how many more views they get compared to others in the area and in the U.S.
SOURCE Realtor.com
