Home Prices Are Cooling—but This Midwestern Metro Bucks the Trend

The new year is starting off with a wealth of home listings—and while the national median home price has fallen, the cost of a home is rising rapidly in one Midwestern metro.

In December, inventory rose for the 26th straight month, but active listings fell seasonally for the month, according to the Realtor.com® December 2025 Monthly Housing Trends report.

"Nationally, the housing market in 2025 was defined by growing inventory (a monthly average of +22.9% year over year) and flat prices," explains Jake Krimmel, senior economist at Realtor.com.

"And generally speaking, the story of 2025 was a slowing market moving in a more buyer-friendly direction, with homes lingering longer and prices flat to down."

Buyer activity cooled and prices eased, with pending sales down. In addition, homes took four days longer to sell than the same period a year ago.

Overall, new listings also cooled, both year over year and month over month. But, inventory recovery was the strongest in the South and West, while the Midwest and Northeast still lagged to pre-pandemic supply levels.

The national median list price registered at $400,000 for December—that's down 0.6% from the same time last year and 3.6% from the prior month.

But home prices in this Midwest metro are rising the fastest: Milwaukee stands out as a national outlier—meaning inventory growth remained far more muted than the national pace, while price-per-square-foot gains stayed well above the U.S. average throughout the year.

Justin Hoffmann, a longtime Milwaukee resident, tells Realtor.com the city offers the perfect balance.

"You get the energy and amenities of a major city without the congestion, stress, and long commutes that often come with one. I can get across town quickly, and the airport is close and easy to navigate, which makes travel simple and stress free," he says.

Hoffmann channels his passion for Milwaukee into his work as a real estate agent with Team Hoffmann Re/Max Lakeside—guiding clients looking to buy and sell through the city and its surrounding suburbs.

"Economically, Milwaukee continues to grow across major industries including finance, manufacturing, tech, and health care, while remaining accessible for remote or hybrid workers who want value without losing career opportunity," says Hoffmann. "On top of that, the city’s neighborhoods offer something for every type of buyer, from walkable urban areas to quiet family-friendly communities and historic districts."

Krimmel notes that "Milwaukee defied these national trends, remaining hot throughout the year. Inventory there grew by just 5.1% year over year on average while list prices per square foot were up 5.7%. Milwaukee and other Wisconsin geos have remained some of the hottest markets throughout 2025, with limited supply and resilient demand."

Regional disparities

Realtor.com economists looked at differences between housing markets in various regions. The report reveals that national averages masked two very different stories.

In the Northeast and Midwest: a tighter more resilient market. In the South and West: a slower, softer market.

Year-over-year inventory growth surged to 30% to 40% in the South and West through the first half of the year before cooling. Meanwhile, inventory gains in the Northeast and Midwest remained in the low double digits.

The economists also said that price dynamics were uneven. On a price-per-square-foot basis, the Northeast saw steady 3% to 4% gains throughout 2025, but prices in the South were flat to negative on average, while the West experienced a midyear downturn.

The report identified "benchmarkets"—metros whose month to month inventory and price movements most closely mirror their regional aggregates. It compared them to "outlier" markets—where local dynamics dominate and regional averages are less relevant.

For benchmarkets, understanding local conditions is similar to understanding the regional trend. On the other hand, outlier markets reflect more idiosyncratic forces the Realtor.com economists highlighted throughout the year.

Milwaukee stands out as the national outlier—highlighting how this metro can look different from other "typical" U.S. markets sharing similarities.

"Compared to larger metros like Chicago or Minneapolis, buyers are able to afford more square footage and stretch their budget further, which is especially attractive to first-time buyers, young families, and professionals," Hoffmann adds.

Krimmel points out that "high interest rates have made many homebuyers move 'down-market' whether to less expensive homes or less expensive metros that still have a lot to offer in terms of access to jobs, culture, etc. Coupled with the fact that Milwaukee (like much of the Midwest) does not build a lot of new housing."

Meanwhile, Oklahoma City stands out as the clear national benchmarket because inventory growth and price-per-square-foot trends closely tracked the U.S. average month after month.

"Oklahoma City being the national 'benchmarket' is neither good nor bad— it just means OKC is the market (among the top 50 metros) most representative of national trends," Krimmel explains. "Heading into 2026, the headline national narratives actually do apply to Oklahoma City, which is clearly not the case for outlier markets like Milwaukee."

By region, benchmarket metros (Pittsburgh in the Northeast and Nashville, TN, in the South) posted inventory and price growth aligned with regional averages. Outliers (Providence, RI, in the Northeast and Washington, DC, in the South) deviated sharply by growing faster or much slower than other metros.