The 5 Best States to Consider Buying Property in 2025, According to Real Estate Experts

Even though real estate prices continue to rise in the United States, that doesn’t mean it’s impossible to find a good deal.

To begin, you might consider the type of house.

See: 7 Types of Homes Expected to Rise in Value by the End of 2025

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“In most cases, new homes or new construction are not eligible for discounts. The second home and vacation markets are good places to look right now, as homeowners are hit by inflation and recession and are starting to offload assets at discounted prices that aren’t necessary for their day-to-day needs,” said Ralph DiBugnara, president of Home Qualified.

Location also makes a huge difference.

Real estate markets vary by region, and some states, even with rising prices, could continue to offer attractive buying opportunities in 2025. Some of the top states to consider, according to real estate experts, include:

1. Tennessee

Tennessee has seen strong growth in recent years, and many real estate experts expect the state to continue to be a good place to buy real estate in 2025, especially since the state’s lack of a personal income tax helps support a growing population.

“Not having to pay income tax can dramatically increase your purchasing power. To see this in action, look at states like Florida, Texas, Tennessee and others that have seen massive in-migration in recent years. These are the places where people want to live, so they’re also the places where your home value is the highest,” said Lori Greymont, creator and host of the real estate TV show Funding Faceoff.

In Tennessee, there are several markets that could be attractive.

“The Volunteer State has seen an influx of people from all over the country. Nashville has become a trendy city, but we’re also seeing strong growth in Chattanooga, Knoxville and Cookeville,” said Joe Hafner, broker and owner of Hafner Real Estate, based in central Tennessee.

“There are still relatively inexpensive homes and land available between Nashville and Cookeville and Nashville and Chattanooga that I think offer great opportunities for value appreciation over the next few years. But you can find opportunities almost anywhere in the state,” he added.

2. North Carolina

Although North Carolina has an income tax, it is lower than many other states, and property taxes are also relatively low.

“Low-tax states, like North Carolina, have become hotbeds for buyers,” DiBugnara said.

It’s not just taxes that determine purchasing decisions.

North Carolina is one of the states Ownify CEO Frank Rohde is bullish on because of its “above-average job creation and migration,” he said. Additionally, places like North Carolina aren’t disproportionately exposed to hurricanes and other extreme weather compared to other states like Florida and Texas, while still having reasonable prices.

“All of these factors combine to make the housing market forecast stronger than the national average or some other markets in the Southeast, which are more exposed to global warming and the resulting increases in insurance costs,” he said.

3. Florida

While not everyone agrees that Florida is a good place to buy, given factors like climate risks, it does have many advantages, including the lack of a personal income tax. At the same time, despite the risk of extreme weather events like hurricanes, the state has attracted residents who want a warmer climate.

“Many people from the northern states on the East Coast are looking to relocate to states with warmer climates. Cities like Jacksonville, Orlando and Tampa are all experiencing rapid growth,” said David H. Michan, a real estate agent, investor and manager at Terra Equity Management.

“There are also a lot of property developers who build houses and offer incentives on mortgages to sell their products. You can buy a house at rates between 5 and 6 per cent subsidised by the developer,” he added.

4. Arizona

According to Michan, Arizona is another warm-weather state that might be a good place to buy.

“Arizona, especially the Phoenix metro area, is growing and there are a lot of companies offering good-paying jobs. Phoenix has a lower cost of living than, say, San Diego or Los Angeles, and equivalent jobs actually pay better. The reason is that there are more jobs available than there are potential employees, so companies are willing to pay more,” he said.

“This is good for real estate because demand for housing is high, which is driving up the cost of buying and renting. The cost of renting will go up first, and eventually the cost of buying a property will go up as well,” Michan predicts.

Additionally, while Arizona does have an income tax, it is only a flat rate of 2.5%, and other costs can be relatively affordable.

“Property taxes are relatively low and the cost of insurance has not skyrocketed” as it has in many other states, he added.

5. Idaho

Finally, Idaho may not get as much attention, but it could “become more important in the coming years,” Hafner suggested.

“The state’s low population density and incredible outdoor recreation opportunities draw people from all over the country. The capital city of Boise offers the kind of hip, trendy downtown that millennials love, and they’ve been moving there in droves in recent years,” he said. “It’s not crazy to say that Boise could be on its way to becoming the next Austin, especially in light of the problems happening in Austin’s real estate market right now,” he added. “Based on what’s happened there in recent years, buying and holding real estate in Idaho seems like a smart move,” Hafner said.

This article was originally published on GOBankingRates.com: The 5 Best States to Consider Buying Homes in 2025, According to Real Estate Experts