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10 Hidden Gem Housing Markets Prime for Growth in 2022

10 Hidden Gem Housing Markets Prime for Growth in 2022
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Home.com Staff

If homebuyers had time machines, they might go back to the beginning of the pandemic and buy real estate in markets like Phoenix, Salt Lake City, or Boise, Idaho to get on the front-end of the near-30% home price growth in 2021.

But for those that can’t travel back in time, the next best thing is to look ahead.

Homebuyers that missed out on 2021’s hottest housing markets may still have a chance to get ahead of the price growth forecasted for 2022. After a year of record price gains, there are still housing markets that are affordable, undervalued, and prime for growth.

Buying early in one of these markets offers an affordable entry into homeownership and the opportunity for rapid home equity. In addition, fixed mortgage payments can be a hedge against inflation and rising rent prices.

The National Association of Realtors® identified the top 10 metros (out of 379) that are undervalued and positioned for strong price growth heading into 2022.

Affordability is measured by using the median home price-to-median family income ratio (price-to-income) for the second quarter of 2021.

The price-to-income ratio for the entire U.S. is 3.3 based on a median home price of $297,506 and median family income of $89,012. In other words, the median home price in the U.S. is a little more than three times the median family income.

As would be expected, all 10 “hidden gem” housing markets are below the U.S. average.

10 hidden gem housing markets for 2022

The following hidden gem housing markets are ranked lowest-to-highest by price-to-income ratio. Ties are broken by the higher 3-year job growth, which can be a forward indicator of economic and housing growth.

Spartanburg, S.C.

Price-to-income ratio: 2.5

3-year job growth: 3.9%

With a median home price of $185,571 and a median family income of $74,790, Spartanburg has the lowest price-to-income ratio in the top 10. It’s also seen solid population, job, and wage growth over the last three years. Tucked between larger metros of Charlotte and Greenville, it’s poised for growth in 2022.

Huntsville, Ala.

Price-to-income ratio: 2.6

3-year job growth: 4.7%

Even after 24% price growth over the last three years, Huntsville is still among the most affordable metros in the U.S. with a median home price of $240,171. It also experienced strong growth in wages (13.4%), jobs (4.7%), and population (5.6%) in the last three years. Located just two hours south of Nashville (price-to-income 3.6), it’s positioned to keep growing as homebuyers search for small, more affordable metros.

Fayetteville-Springdale-Rogers, Ark.-Mo.

Price-to-income ratio: 2.7

3-year job growth: 7.2%

This metro boasts the highest 3-year job growth on the list and 3-year wage growth of 21%. Combined with 6.3% population growth, this strong economic growth will likely drive up home prices from the current median of $233,786.

Daphne-Fairhope-Foley, Ala.

Price-to-income ratio: 2.7

3-year job growth: 5.7%

Just outside Mobile, Ala., the Daphne-Fairhope-Foley metro population is growing at a rate of 7.8% over the last three years – the fastest rate on the list. Wage growth (36.6%) has risen at double the rate of home prices (17.7%) over the last three years. Even with this recent growth, the median home price of $262,568 is below the national median while the median family income of $98,969 is well above it.

Knoxville, Tenn.

Price-to-income ratio: 2.7

3-year job growth: 2.1%

With a median home price of $228,878, Knoxville has become an attractive spillover for homebuyers priced out of Nashville. Wages have increased 16.5% in the last three years and nearly 10,000 people moved here in 2020 alone. As services such as broadband internet increase, Knoxville may become an affordable destination for businesses and remote workers, driving up home prices.

San Antonio-New Braunfels, Texas

Price-to-income ratio: 2.8

3-year job growth: 0.9%

With a median home price of $227,684 San Antonio-New Braunsfels metro is a much more affordable option than nearby Austin ($410,653). But the secret seems to be out as over 25,000 people moved here in 2020 and there are three new residents per building permit. With steady economic growth and a shortage of housing supply, home prices are poised to rise in 2022.

Palm Bay-Melbourne-Titusville, Fla.

Price-to-income ratio: 2.9

3-year job growth: 3.7%

Palm-Bay-Melbourne-Titusville boasts a significantly lower price-to-income ratio than larger surrounding metros like Orlando (3.9), Tampa-St. Petersburg (3.5) and Miami (4.7). It also features the second-highest 3-year wage growth (27.2%) on the list, which is sure to put upward pressure on the median home price of $278,684 over time.

Pensacola-Ferry Pass-Brent, Fla.

Price-to-income ratio: 2.9

3-year job growth: 2.4%

On the Florida panhandle, this metro has a similar price-to-income as Palm Bay-Melbourne-Titusville but with a lower median home value of $231,168. With wide-scale broadband internet access, sandy beaches, and 15.6% wage growth, it’s only a matter of time before home prices trend upward.

Dallas-Fort Worth-Arlington, Texas

Price-to-income ratio: 3.0

3-year job growth: 3.2%

This is the largest and youngest metro in the top 10 and still growing. Nearly 60,000 people moved to Dallas-Fort Worth-Arlington in 2020 alone, yet the median home price of $293,976 is below the national median. Wage growth (15.0%) is on par with home price growth (15.8%), but with 1.9 people per building permit, housing shortage may give home prices a push.

Tucson, Ariz.

Price-to-income ratio: 3.0

3-year job growth: 0.4%

With a median home price of $261,046, Tucson is an affordable spillover from Phoenix, where prices have grown 28.5% in the last three years and has a price-to-income ratio of 4.3. Due to domestic migration in recent years, home price growth (23.4%) is out-pacing wage growth (15.6%), and there are 2.5 new residents per housing permit. Tucson is affordable now, but trending toward price increases in 2022.


Some references sourced within this article have not been prepared by Fairway and are distributed for educational purposes only. The information is not guaranteed to be accurate and may not entirely represent the opinions of Fairway.

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