Affordability and job growth are key drivers of competition 

• Competition among buyers never cooled in Buffalo last year, and that heat should keep smoldering through 2025.
• Hot markets spread from the Northeast, Great Lakes and South regions into the Midwest and West.
• Virginia Beach jumped farthest up the list from 2024, leapfrogging over 23 markets.

SEATTLE, Jan. 7, 2025 /PRNewswire/ — Buffalo, New York, will be the hottest major housing market in 2025, according to a new analysis by Zillow®, the first time a market has held the title in back-to-back years. Relative affordability and few homes for sale are common threads among what should be the most competitive markets for buyers this year. 

“Construction that keeps pace with an area’s growth remains a crucial piece of keeping homes available and accessible. In chilly Buffalo, competition among buyers will remain hot, with employment growing far faster than builders are adding homes,” said Skylar Olsen, Zillow chief economist. “Shoppers nationwide should see more options for sale than in recent years, along with slow and steady price growth. That’s the good news. But both buyers and sellers should expect unpredictable mortgage rates.”

This hotness ranking of the nation’s 50 most populous metros takes into account Zillow’s forecast for local home value growth and how quickly homes are selling. It also considers job growth per new home permitted and expected growth in owner-occupied households. 

Zillow forecast Buffalo to be the hottest market in 2024, and that prediction proved prescient. Sellers held a strong advantage in negotiations there throughout last year, according to Zillow’s market heat index.

Buffalo has the most new jobs per new home permitted — a measure of expected demand. New jobs often mean new residents, which raises competition and drives up prices unless builders can match the additional demand.

Although affordability has improved slightly compared to last year, it’s still top of mind for buyers. Lower-than-average home prices and rent costs in Buffalo as well as Midwest metros like Indianapolis, St. Louis and Kansas City have bolstered demand in these areas, helping push them to the top of the list. 

Relative affordability is a powerful force, too. Nearby alternatives to expensive Northeastern metros like New York and Boston dominated Zillow’s list of the most popular cities among home shoppers in 2024. Metropolitan areas in the same vein — Providence, Hartford and Philadelphia — rank high on this list as well.

Hartford, Providence, Indianapolis and Charlotte are all among the top five in Zillow’s forecast for home value appreciation in 2025. Hartford leads the pack with 4.2% expected growth. But home value growth is set to largely level out this year — even these standout metros look tame compared to the double-digit annual appreciation seen in 2021 and 2022. 

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Rising fastest in the ranks from 2024’s hottest markets list is Virginia Beach, which leapfrogged over 23 markets to the No. 13 spot this year, driven by job growth that has far outpaced new home permitting. Memphis fell the farthest by the same token, dropping 30 places, as new home permitting has eclipsed low job growth. 

After the entire western half of the country was shut out of last year’s top 10, Salt Lake City nudged its way onto this year’s list at No. 10. San Diego was the only other Western metro in the top 20, at No. 19. 

Mortgage rates are likely to continue on their bumpy path in 2025, and swings will have a major impact on which homes shoppers can afford or even qualify for. Zillow Home Loans’ BuyAbility^SM tool tracks rates in real time to show users which homes fit their budget.

About Zillow Group:
Zillow Group, Inc. (Nasdaq: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, dedicated partners and agents, and easier buying, selling, financing, and renting experiences. 

Zillow Group’s affiliates, subsidiaries and brands include Zillow®, Premier Agent®, Zillow Home Loans℠, Zillow Rentals®, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce®, and Follow Up Boss®. 

All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2025 MFTB Holdco, Inc., a Zillow affiliate.

(ZFIN)

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SOURCE Zillow

Beverly Moran, Vanderbilt University

The Tax Cuts and Jobs Act, a set of tax cuts Donald Trump signed into law during his first term as president, will expire on Dec. 31, 2024. As Trump and Republicans prepare to negotiate new tax cuts in 2025, it’s worth gleaning lessons from the president-elect’s first set of cuts.

The 2017 cuts were the most extensive revision to the Internal Revenue Code since the Ronald Reagan administration. The changes it imposed range from the tax that corporations pay on their foreign income to limits on the deductions individuals can take for their state and local tax payments.

Trump promised middle-class benefits at the time, but in practice more than 80% of the cuts went to corporations, tax partnerships and high-net-worth individuals. The cost to the U.S. deficit was huge − a total increase of US$1.9 trillion from 2018 to 2028, according to estimates from the Congressional Budget Office. The tax advantage to the middle class was small.

Advantages for Black Americans were smaller still. As a scholar of race and U.S. income taxation, I have analyzed the impact of Trump’s tax cuts. I found that the law has disadvantaged middle-income, low-income and Black taxpayers in several ways.

Cuts worsened disparities

These results are not new. They were present nearly 30 years ago when my colleague William Whitford and I used U.S. Census Bureau data to show that Black taxpayers paid more federal taxes than white taxpayers with the same income. In large part that’s because the legacy of slavery, Jim Crow and structural racism keeps Black people from owning homes.

The federal income tax is full of advantages for home ownership that many Black taxpayers are unable to reach. These benefits include the ability to deduct home mortgage interest and local property taxes, and the right to avoid taxes on up to $500,000 of profit on the sale of a home.

It’s harder for middle-class Black people to get a mortgage than it is for low-income white people. This is true even when Black Americans with high credit scores are compared with white Americans with low credit scores.

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When Black people do get mortgages, they are charged higher rates than their white counterparts.

Trump did not create these problems. But instead of closing these income and race disparities, his 2017 tax cuts made them worse.

Black taxpayers paid higher taxes than white taxpayers who matched them in income, employment, marriage and other significant factors.

Broken promises, broken trust

Fairness is an article of faith in American tax policy. A fair tax structure means that those earning similar incomes should pay similar taxes and stipulates that taxes should not increase income or wealth disparities.

Trump’s tax cuts contradict both principles.

Proponents of Trump’s cuts argued the corporate rate cut would trickle down to all Americans. This is a foundational belief of “supply side” economics, a philosophy that President Ronald Reagan made popular in the 1980s.

From the Reagan administration on, every tax cut for the rich has skewed to the wealthy.

Just like prior “trickle down” plans, Trump’s corporate tax cuts did not produce higher wages or increased household income. Instead, corporations used their extra cash to pay dividends to their shareholders and bonuses to their executives.

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Over that same period, the bottom 90% of wage earners saw no gains in their real wages. Meanwhile, the AFL-CIO, a labor group, estimates that 51% of the corporate tax cuts went to business owners and 10% went to the top five highest-paid senior executives in each company. Fully 38% went to the top 10% of wage earners.

In other words, the income gap between wealthy Americans and everyone else has gotten much wider under Trump’s tax regime.

Stock market inequality

Trump’s tax cuts also increased income and wealth disparities by race because those corporate tax savings have gone primarily to wealthy shareholders rather than spreading throughout the population.

The reasons are simple. In the U.S., shareholders are mostly corporations, pension funds and wealthy individuals. And wealthy people in the U.S. are almost invariably white.

Sixty-six percent of white families own stocks, while less than 40% of Black families and less than 30% of Hispanic families do. Even when comparing Black and white families with the same income, the race gap in stock ownership remains.

These disparities stem from the same historical disadvantages that result in lower Black homeownership rates. Until the Civil War, virtually no Black person could own property or enter into a contract. After the Civil War, Black codes – laws that specifically controlled and oppressed Black people – forced free Black Americans to work as farmers or servants.

State prohibitions on Black people owning property, and public and private theft of Black-owned land, kept Black Americans from accumulating wealth.

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Health care hit

That said, the Trump tax cuts hurt low-income taxpayers of all races.

One way they did so was by abolishing the individual mandate requiring all Americans to have basic health insurance. The Affordable Care Act, passed under President Barack Obama, launched new, government-subsidized health plans and penalized people for not having health insurance.

Department of the Treasury data shows almost 50 million Americans were covered by the Affordable Care Act since 2014. After the individual mandate was revoked, between 3 million and 13 million fewer people purchased health insurance in 2020.

Ending the mandate triggered a large drop in health insurance coverage, and research shows it was primarily lower-income people who stopped buying subsidized insurance from the Obamacare exchanges. These are the same people who are the most vulnerable to financial disaster from unpaid medical bills.

Going without insurance hurt all low-income Americans. But studies suggest the drop in Black Americans’ coverage under Trump’s plan outpaced that of white Americans. The rate of uninsured Black Americans rose from 10.7% in 2016 to 11.5% in 2018, following the mandate’s repeal.

The consumer price index conundrum

The Trump tax cuts also altered how the Internal Revenue Service calculates inflation adjustments for over 60 different provisions. These include the earned income tax credit and the child tax credit – both of which provide cash to low-wage workers – and the wages that must pay Social Security taxes.

Previously, the IRS used the consumer price index for urban consumers, which tracks rising prices by comparing the cost of the same goods as they rise or fall, to calculate inflation. The government then used that inflation number to adjust Social Security payments and earned income tax credit eligibility. It used the same figure to set the amount of income that is taxed at a given rate.

The Trump tax cuts ordered the IRS to calculate inflation adjustments using the chained consumer price index for urban consumers instead.

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The difference between these two indexes is that the second one assumes people substitute cheaper goods as prices rise. For example, the chained consumer price index assumes shoppers will buy pork instead of beef if beef prices go up, easing the impact of inflation on a family’s overall grocery prices.

The IRS makes smaller inflation adjustments based on that assumption. But low-income neighborhoods have less access to the kind of budget-friendly options envisioned by the chained consumer price index.

And since even middle-class Black people are more likely than poor white people to live in low-income neighborhoods, Black taxpayers have been hit harder by rising prices.

What cost $1 in 2018 now costs $1.26. That’s a painful hike that Black families are less able to avoid.

The imminent expiration of the Trump tax cuts gives the upcoming GOP-led Congress the opportunity to undertake a thorough reevaluation of their effects. By prioritizing policies that address the well-known disparities exacerbated by these recent tax changes, lawmakers can work toward a fairer tax system that helps all Americans.

Beverly Moran, Professor Emerita of Law, Vanderbilt University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Jeffrey Anvari-Clark, University of North Dakota

About 1 in 5 American adults regularly provide unpaid care or financial assistance to their adult relatives or friends. And about 1 in 7 young adults between the ages of 25 and 34 live with their parents.

But the true extent of support among Americans is deeper and broader.

From parents covering the cost of unexpected car repairs to colleagues raising funds for their co-workers’ medical expenses, Americans help each other in countless ways.

As a social work scholar who researches these patterns of what I call “financial interdependence,” I often observe transactions that challenge a common American narrative that most people in this country are handling their expenses on their own.

A long-standing tradition

The practice of sharing money with your friends and loved ones has deep roots in American society. Many Native American communities have traditions of sharing food and other resources with one another.

In the 19th century, mutual aid societies formed everywhere from Philadelphia to Florida. Many of them helped free Black people weather economic hardships. These organizations provided everything from unemployment assistance to burial expenses.

Today’s informal support networks echo these historical patterns.

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In particular, many immigrant communities maintain traditional practices of collectively saving and lending money. Mexican American families often participate in “tandas,” which pool their savings to achieve financial goals or meet urgent needs. Similarly, West African and Caribbean communities in the U.S. organize “susu” groups, while many Chinese American communities form “hui” associations.

Local “hometown associations” additionally often offer both financial and social support to their members – aiding immigrant communities in the U.S. and people back in their homelands.

Everyone does it

These mutual support arrangements are very widespread and operate across all income levels, though they take different forms. They can be secular or religious. The true extent of this kind of activity is generally unknown.

Lower-income families often engage in frequent, smaller exchanges. They might share grocery costs, for example, or relatives may help one another out with the payment of large, unexpected bills.

Wealthier Americans tend to give larger amounts of money to extended family members, but less often. These might include a parent’s help with a down payment on a young adult’s first house or paying a portion of the cost of a grandchild’s college education.

Some families establish formal structures such as financial trusts or 529 educational savings accounts to make these transfers easier to complete and track. The number of people using 529 accounts has been increasing steadily, as states offer matching funds and tax incentives.

The nature of this financial support often reflects economic needs and cultural values. In many East Asian American communities, for example, adult children routinely provide financial support to their parents – as a cultural expectation.

Regardless of the community involved, technology has transformed how people share money with their friends and family.

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Mobile payment platforms make it easier to split costs and send quick assistance. Money-transfer apps have normalized small-scale financial sharing among friends and family.

Online and social media platforms are used to gather resources for medical expenses, funerals or emergency needs. These tools extend traditional support networks beyond geographic boundaries.

Other kinds of support

Financial assistance can extend far beyond direct monetary help.

Families and communities might purchase bulk grocery items together to save money, or live together to manage rising housing costs. Some parents create informal child care cooperatives, while others coordinate care responsibilities for aging relatives with their extended families.

Financial education often emphasizes individual savings and budgeting. Yet, many Americans practice financial interdependence by managing their finances and making decisions in collaboration with others.

Addressing challenges

To meet today’s economic challenges, Americans are finding creative solutions through shared resources.

Young adults increasingly need more help to become homeowners than what they can get from a bank. The median home price has far outpaced wage growth, making family assistance crucial for many first-time buyers.

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College costs have stabilized, albeit at high levels, leading more families to pool resources for educational support. This often creates long-term financial obligations across generations.

Medical expenses remain a leading cause of financial strain, pushing families to rely on each other to pay for health-related costs.

These support systems work at many levels, including family, community, the workplace and in government.

Some employers now offer emergency loan programs and matching funds for employee hardship. Some businesses create formal peer support systems for employees facing financial challenges.

A few states are also supporting family caregivers by providing tax credits to reimburse their out-of-pocket expenses.

Recognizing the financial burden of caregiving, Michigan Gov. Gretchen Whitmer has proposed a tax credit to support dependent respite services, nursing and transportation.

Some complications

While financial interdependence provides crucial assistance, it can also create challenges.

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Financial responsibilities can strain family and friendship bonds. The provision of too much financial help can create or reinforce power imbalances within relationships. Some communities may not have enough money to be able to equally and effectively assist all members.

Clear communication and healthy boundaries can help manage these tensions.

As economic pressures mount for many American families, these informal financial support networks are growing more vital. Studies show that rising costs make financial stability increasingly difficult to achieve on your own.

Jeffrey Anvari-Clark, Assistant Professor of Social Work, University of North Dakota

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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