After holding the top spot as the hottest housing market for two consecutive months, Hartford, Connecticut, has been dethroned by a midsize Midwest metro in Rockford, Illinois, in the August 2026 Hottest Housing Markets report by Realtor.com®.
Previously, Rockford sat in 10th place for June’s report, while Hartford ranked in first place for June and May.
The housing market continues to favor the Midwest and Northeast, as they were the only regions represented in the latest report. Rockford has appeared in the top 20 for a total of 41 times, but this is the first time it’s ranked at No. 1 since December 2024.
The report notes that Rockford’s rise through the rankings “reflects a continued trend of home shoppers seeking affordability within commutable range from larger business hubs like Chicago and Madison.” Going back to the pandemic, more affordable metro areas—particularly in the South and Midwest—have seen increased interest from buyers, while Sun Belt hot spots generally cooled.
Realtor.com ranks hottest housing markets by examining market demand and the pace of the market. Market demand is measured using the portal’s unique views per property, while the pace of the market is measured by the number of days a listing remains active on the website.
Meet me in the Midwest
Rockford wasn’t the only Midwestern market to claim a spot in the top five. Kenosha, Wisconsin, maintained its ranking from last year in second place, followed by Erie, Pennsylvania, in third place.
Several Midwestern markets saw significant growth on a year-over-year basis. Rockford moved up eight places from last year and Erie moved up 11 spots. Wausau, Wisconsin, however, jumped the most, moving up 19 places to sit in fifth place for hottest markets. Other notable shifts include Peoria, Illinois, and Monroe, Michigan, which both rose 18 spots from last year and now sit at ninth and tenth place respectively.
The report highlights the differences between the Midwestern and Northeastern representation in the top 20. Collectively, the Midwest markets have a median listing price of $306,472, which is roughly $70,000 less than that of the Northeast markets on the list, the report states.
“Affordability is doing a lot of the work in this group,” the report states. “At a median listing price well below their Northeast counterparts and the national median, the Midwest is giving buyers meaningfully more purchasing power without straying from major job centers.”
This rise for market temperatures in Midwest markets aligns with other housing trends. In its housing trends report for August, Realtor.com reported that the Midwest’s inventory increased by 10.5%, the biggest increase out of the four regions. The Northeast followed suit with a 9.1% increase.
Cold season
The latest data from Realtor.com reveals that markets in large cities are cooling on the hotness scale. Dense markets like Indianapolis, Indiana, and Boston, Massachusetts, have fallen in the rankings. Indianapolis fell 41 spots from last year, now ranking in at 139th place while Boston fell 34 spots and now sits at 87th place.
August’s results seem to highlight a static, or slowing pattern for the housing market, according to the report.
“This month’s biggest movers gained just 16 to 41 spots—well below the 36-to-95-spot swings seen at this time last year,” the report states. “That relative lack of movement reaffirms the holding pattern the market seems to be in: elevated mortgage rates through August did little to spur buyer demand in new geographies, keeping hot large markets relatively hot and cool large markets relatively cool.”
Affordability may continue to push homeownership out of reach for some buyers, as the latest Freddie Mac data shows that the average 30-year fixed-rate mortgage reached a 13-month high at 6.71%.
But nothing is certain, as the Federal Reserve is set to make another interest rate decision later this month. The Bureau of Labor Statistics (BLS) reported that 162,000 jobs were added in August, offering some evidence of macro momentum.
Prior to the report, Fed Governor Christopher Waller said that he and other board members would refer to the report and unemployment rate—which sits at 4.1%—when deciding whether to maintain or raise interest rates, in a speech last week.
