This idyllic New England town is America’s hottest real estate market – and homes are available for $415,000 – half the price of nearby Boston

On December 27, 2024By Littum

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Zillow’s annual list of America’s hottest real estate markets has been heavy on surprises lately. Entering 2024, Buffalo, New York surprised everyone by taking the number one position. But Manchester, New Hampshire, a city with neighborhoods straight out of a Norman Rockwell painting, has been 2024’s most popular market. Despite Manchester’s popularity, you can still shop here for half of what it costs in nearby Boston.

America’s Northeast is famous for its lush forests, beautiful winters and mild summers. But people born and raised in this part of New England know it offers so much more. Despite being within easy driving distance of Boston, the pace of life in Manchester is much less hectic and the family-oriented vibe is unmistakable. Manchester’s small town feel is real, mainly because it is a small town.

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The population is listed at just 115,000 and until recently residents of Manchester had this city all to themselves. That’s starting to change, primarily because the price of real estate in Boston is exploding much faster than the wages of the area’s workers. Initially, this increase in property values was limited to suburbs in the Boston Metro area such as Waltham, Lexington and Newton.

Now that Boston’s median home price (according to Zillow) has hit $750,000, potential buyers looking for more affordable alternatives have discovered Manchester. Home prices here are steadily rising, and Zillow analyst Treh Manhertz estimates that the average home in Manchester will set you back $415,000. Manhertz says that’s up 7.3% from last year, but still just over half of what you’d pay in Boston.

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Financing $300,000 less to buy a comparable home in Manchester will save buyers approximately $18,000 per year and $540,000 over the course of a 30-year mortgage. It’s worth noting that this isn’t where the money saving ends for Manchester residents. In addition to being one of the few states with no income tax, New Hampshire has no sales tax.

In contrast, Massachusetts has an income tax rate of 5% and charges an additional 4% on incomes over $1,000,000. While the 4 per cent wealth tax isn’t a problem for most people, workers making $100,000 a year can knock $5,000 off their tax bill simply by moving to New Hampshire. More importantly, an annual income of $100,000 puts them closer to buying a home in Manchester than they ever will be in Boston.

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Data from the Mortgage Research Center shows buyers need to earn an average salary of $108,000 to afford a $400,000 mortgage. The US Census reports that the median household income in Boston is $96,931. Given these two data points, Manchester’s property market on fire makes perfect sense. It’s just over an hour by train from Manchester to Boston, and buyers get so much more for their money in New Hampshire.

It’s worth noting that the second hottest city on Zillow’s top 10 list is tiny Rockford, Illinois, where you can buy a home for as little as $157,000. This follows a trend from last year, when cities such as Buffalo, New York, Columbus, Ohio and Indianapolis, Indiana made the top 10 list. Housing prices below the national average are what all these cities have in common. American home buyers still voting with their wallets.

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