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Austin Tops U.S. Housing Market Rankings with Highest Rental Yield

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  Published in House and Home on Tuesday, December 23rd 2025 at 7:42 GMT by Newsweek

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The Best U.S. Housing Markets – What the Map Really Says

Newsweek’s feature “Map shows 10 cities best US housing markets” presents an eye‑popping visual that anyone looking to buy or invest in real estate can’t ignore. The story’s central claim—that ten particular U.S. cities out‑shine the rest of the country in terms of a healthy, profitable housing market—rests on a tidy set of data that the article breaks down in plain English. Below is a full, 500‑plus‑word recap that pulls together the key points, the methodology, the top ten markets and what they mean for buyers, investors, and policymakers alike.

1. The Methodology – How the Map Was Built

Newsweek doesn’t just hand‑wave “the best markets” at its readers. Instead, the article explains that the ranking is derived from a blend of affordability, price growth, and rental performance metrics, all pulled from reliable public and commercial sources (U.S. Census, Zillow, Redfin, and the Federal Housing Finance Agency).

The affordability component is broken into two parts:

1. Price‑to‑income ratio – median home price divided by median household income.
2. Price‑to‑rent ratio – median home price divided by median monthly rent.

These ratios are plotted on a heat‑map so that a “green” spot indicates a market where the average home is a few times the median income and can be paid for with a modest rental income, whereas a “red” spot means prices are high relative to earnings and rentals.

The growth element tracks changes in median home price and rental rates over the last five years (2019‑2024), while the rental yield is the ratio of annual rent to home price, expressed as a percentage. The article notes that higher yields tend to signal better cash‑flow prospects for landlords, especially in markets with rising property values.

To create a single score, Newsweek uses a weighted average (40 % affordability, 30 % growth, 30 % yield). The resulting composite score is then plotted on the map, with darker colors indicating a higher overall score.

The article also links to the source data sheets on the U.S. Census website and to Zillow’s “Home Value Index” page, giving readers a chance to dig deeper into the numbers if they wish.

2. The Ten Cities that Lead the Pack

Below are the cities that made the list, in order of their composite scores. For each, Newsweek highlights a couple of key take‑aways that illustrate why they stand out.

Note: The above figures are rounded approximations pulled from the article’s embedded charts.

Austin – The Tech‑Driven Powerhouse

Austin tops the list because it’s a classic tech‑hub: a growing population, booming startups, and a strong local economy all keep demand for both owner‑occupied homes and rentals high. Its rental yield (5.8%) is the highest on the list, which is why landlords love the city.

Raleigh – A Balanced Blend

Raleigh’s growth is powered by universities (North Carolina State) and a robust tech scene, especially in the Research Triangle. The city has a lower median price than Austin, but its affordability ratio of 4.2 keeps it attractive for families.

Nashville – Culture Meets Commerce

Nashville’s cultural appeal (country music, live‑music venues) combined with a diversified economy (healthcare, tech, finance) has lifted the city’s housing market into the upper tier. Its price growth of 28% in five years is a good sign for future investors.

Charlotte – The Southern Wall Street

Charlotte’s status as a financial center fuels a steady influx of new residents. The city’s balanced mix of affordability and growth keeps it near the top of the ranking.

Tampa and Phoenix – Affordability and Expansion

Both Tampa and Phoenix enjoy lower price‑to‑income ratios (5.8 and 5.3, respectively). While their growth rates are slightly lower than the top‑tier tech cities, they offer solid rental yields and less competitive buyer markets, which could translate into higher returns for investors.

Dallas, Denver, Boise, Salt Lake City – The Growing Midwest

Dallas, Denver, Boise, and Salt Lake City each display strong 5‑year growth curves, but their higher price‑to‑income ratios mean they are less affordable than the top four. Still, their rental yields stay respectable, and these markets show strong job‑market fundamentals.

3. What the Map Reveals About Housing Trends

Newsweek points out that the map’s color palette tells a larger story:

• South and Southwest dominate the top tier. Austin, Nashville, Charlotte, Dallas, Phoenix, Tampa – all cities in or near the Sun Belt – benefited from the post‑COVID “remote‑work” migration. People left expensive East Coast metros and found cheaper, warmer, and culturally vibrant places to live.
• Midwest and Rocky Mountain cities (Raleigh, Denver, Boise, Salt Lake City) represent the second wave of migration: professionals moving from saturated West Coast markets into growing secondary cities that still offer job opportunities and a more affordable lifestyle.
• Growth vs. Affordability – The map demonstrates that a city can have a great price‑to‑income ratio but still lag behind in price growth (for instance, Boise). Investors need to decide whether they want stable cash flow or rapid appreciation.

The article also highlights that the data set includes a “worst‑off” region in the map – large parts of the Great Plains and some northern cities where median incomes are low but housing prices are high, creating a negative affordability index.

4. Implications for Buyers and Investors

For First‑Time Buyers:
Cities like Austin and Charlotte offer the best balance of affordability and growth. A buyer looking for a home that will likely appreciate while still fitting within a decent price‑to‑income ratio will do well in these markets.

For Real‑Estate Investors:
The highest rental yields appear in Austin, Raleigh, and Nashville. If an investor’s focus is cash flow, these cities provide a good starting point. However, if the goal is capital appreciation, then a city’s price growth (like Austin or Denver) might outweigh a slightly lower yield.

For Rent‑Seekers:
Rent growth is not uniform. Cities with high price‑to‑income ratios (Boise, Salt Lake City) have seen rents rise by roughly 8–9% over five years – a sign that landlords might push up rent more aggressively in these markets. Buyers should be aware that renting can get expensive as these markets mature.

For Policy Makers:
The map highlights that housing affordability is still a pressing issue in many U.S. cities, especially those in the Sun Belt. Local governments could look into zoning reforms, inclusionary housing mandates, or rent‑control measures to keep markets balanced.

5. Follow‑Up Resources

The article links to:

• Zillow’s Home Value Index (for more granular home‑price data).
• U.S. Census “Income and Poverty” dataset (to verify median household income).
• Redfin’s Rental Market Trends (to dig into rent growth statistics).

These resources give readers a chance to verify the article’s findings or to compare their own city of interest.

6. Bottom Line

Newsweek’s map and accompanying article do more than just list the “top 10” – they offer a concise, data‑driven snapshot of a country’s most promising housing markets. Whether you’re a homeowner looking for a good deal, an investor chasing yields, or a policy analyst monitoring affordability, the map serves as a useful quick reference. By combining affordability, growth, and yield, the story encourages readers to look beyond headline price figures and consider how a city’s overall economic health translates into real housing value.

If you’re planning a move, a purchase, or a portfolio shift, check out the full article and the embedded data sets to see where your next investment could be – or where you might find a more affordable, thriving community to call home.