Sun Belt Cities Lead Price Growth in 2026 Q1

Sun Belt metropolitan areas led home-price growth in the first quarter of 2026, reversing a two-year narrative of post-pandemic correction. Raleigh, North Carolina, topped the rankings with a 7.2% year-over-year gain in the Zillow Home Value Index, followed by Tampa, Florida at 6.9% and Charlotte, North Carolina at 6.4%.

The reversal comes after Sun Belt cities had underperformed the national average through most of 2024 and early 2025 as inventories recovered and buyer demand cooled. Zillow's March report showed that active listings in Raleigh fell 7% year-over-year, a reversal from the 22% surge recorded in March 2025. Tampa listings dropped 4%, and Charlotte listings were down 9%.

"We are seeing the return of demand patterns that were absent in 2024," said Skylar Olsen, chief economist at Zillow. Olsen attributed the shift to sustained in-migration from higher-cost coastal markets, continued job growth in logistics and technology, and builders pulling back on speculative construction after two years of margin compression.

Realtor.com data showed Raleigh received 2.1 unique page views per listing in February, the fourth-highest among the 50 largest metros. Nashville, another Sun Belt market, ranked sixth. Redfin's index of home offers written by its agents showed that 38% of Raleigh offers faced competition in February, up from 22% a year earlier.

Not all Sun Belt markets shared the gains. Phoenix prices rose just 2.1% year-over-year, while Austin prices remained 3.2% below their 2022 peak despite modest recent firming. Both cities experienced aggressive pandemic-era price appreciation that required a longer adjustment period, according to a research note published by John Burns Research and Consulting.

CoreLogic economist Thom Malone said the divergence within the Sun Belt is driven by local supply. "Markets where builders kept producing through the downturn have more inventory and less price pressure. Markets where builders pulled back early are now running into the same affordability trap the broader market faced two years ago," Malone said.

Migration data from the U.S. Census Bureau and United Van Lines showed North Carolina, Texas, and Florida remained among the top states for net domestic in-migration in 2025. Raleigh-Durham drew particular interest from households moving from the Washington, D.C. metro area and from Northern Virginia tech hubs. The Raleigh Regional Association of Realtors reported that 28% of closed transactions in the first quarter involved out-of-state buyers.