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RI REAL ESTATE

Providence predicted one of the hottest housing markets in 2024, according to Zillow

Providence will be one of the year's hottest housing markets, Zillow predicts.Jonathan Wiggs/Globe Staff

PROVIDENCE — Providence will have one of the hottest housing markets in the country in 2024, according to Zillow’s annual predictions report.

Ranked, respectively, behind Buffalo, Cincinnati, Columbus, and Indianapolis, Providence will have the fifth hottest housing market in 2024, the real estate website said last week. It is the easternmost cityto make the list.

Zillow’s hottest markets list is based on an analysis of home value growth, projected changes in the labor market, home construction activity, and the number of homeowner households, according to the report.

“These should stand out as strong in a housing market still buffeted by low inventory and relatively high mortgage rates and prices,” the report said of the top predicted housing markets. “While mortgage rates have come down significantly in recent weeks, and projections for improved affordability and more homes for sale have become more common, the challenges that limited the US housing market last year are unlikely to disappear entirely in 2024.”

Buffalo is predicted to hold down the No. 1 hottest market in 2024 because of “recent increases in the number of jobs created compared to the number of new homes construction projects being approved, as well as expectations for steady home values,” Zillow said.

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Cincinnati’s second-place rank is because of its “high market velocity,” or the amount of time a property spends on the market before it is sold, Zillow said.

“For most months of 2023, homes that went pending in Cincinnati did so in a median of just five or six days,” Zillow said.

The average home in Providence costs $367,225, which is up 7.8 percent over the past year, according to Zillow’s most recent data. Homes listed for sale in Providence stay on the market an average of about 13 days, according to data tracked through November 2023. Homes in the College Hill neighborhood were listed as the most expensive with the median price of $833,095; followed by homes in Fox Point at $504,889; and homes located downtown at $478,459,according to Zillow. The city’s most affordable neighborhoods are Olneyville, with an average median price of $319,020, followed by Smith Hill at $320,328, and the West End at $331,775.

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Growth in home values generally slowed in 2023, and even fast-growing markets like Providence are expected to slow significantly in 2024, Zillow’s report said.

The Rhode Island Association of Realtors released data in December showing high demand continued to drive up home prices in the Ocean State in November. The median price for single-family homes in Rhode Island was recorded at $431,000, up from $411,450 a year earlier — a 4.8 percent increase, RI Realtors said.

“A shortage of inventory and high mortgage rates have been the main factors hampering the housing market,” RI Realtors said in a news release. “However, the inventory of single-family homes available for sale rose from 1.5 months in November 2022 to 1.9 months last month and recent reports from the Federal Reserve have many economists predicting a decline in interest rates in the coming year.”

Rhode Island was also ranked ninth on Realtor.com’s list of hottest US markets in November, up from tenth in October.

Here are Zillow’s top 10 predicted hottest real estate markets in 2024:

1. Buffalo, NY

2. Cincinnati, OH

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3. Columbus, OH

4. Indianapolis, IN

5. Providence, RI

6. Atlanta, GA

7. Charlotte, NC

8. Cleveland, OH

9. Orlando, FL

10. Tampa, FL


Brittany Bowker can be reached at brittany.bowker@globe.com. Follow her @brittbowker and also on Instagram @brittbowker.