22 Southern Cities at Risk of Skyrocketing Costs by 2025
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The Southern United States has long been celebrated for its affordability, charm, and economic opportunities. However, recent trends indicate that this affordability might be coming to an end in some key cities. According to a 2023 study by Moody’s Analytics, home prices in many Southern cities rose by over 40% between late 2019 and mid-2023.
This surge has been particularly noticeable in states like Texas, Florida, and North Carolina, where population growth has outpaced the availability of housing and infrastructure. Here are 22 Southern cities at risk of soaring costs.
Nashville, Tennessee
Home to a famed music scene and entrepreneurial spirit, Nashville has seen a great employment revival. According to The Tennessean, the city draws more than 86 newcomers every day.
Despite an influx of residents over recent years, this rise in inhabitants has resulted in living costs increasing, with rent prices rising 28 percent between 2019 and 2023. If housing development doesn’t grow at the same pace, those costs will continue to rise, making it less affordable for many of Nashville’s residents
Charlotte, North Carolina
Due to corporate relocations, Charlotte’s housing market is in high demand and is experiencing more competition than before for available properties. The median rent in Charlotte rose 23 percent over two years, according to a Zillow report.
But developers are struggling to keep tabs on the demand, with worries that continued growth might outstrip the availability of housing, leaving the city unable to deal with new residents.
Orlando, Florida
The city’s tourism and tech industries have been a major driver of its economy and are key to providing jobs for many residents. However, these sectors don’t generally pay living wages enough to keep pace with rising living costs.
Orlando rents have gone up a staggering 19% just this year, according to Apartment List data, resulting in an economic mismatch that’s putting locals’ day to day affordability and financial stability on the line.
Tampa, Florida
Tampa’s picturesque waterside lifestyle and pleasant climate make it a popular destination for retirees and remote workers. As a result, housing prices have escalated, with the Tampa Bay Economic Development Council reporting a 50% increase over the past five years.
This rapid rise in costs is causing concern among longtime residents who struggle to keep up with the changing housing market dynamics.
Dallas, Texas
What stands out among Dallas’ business accomplishments is its role in attracting Fortune 500 company relocations, which has created more demand for housing in the area. Dallas’s median rent is $2,025, $30 higher than in 2023, which also raises affordability concerns for those not working for large companies.
As affordable housing options grow in demand for all demographics, the city continues to find ways to balance growth with accessibility.
Houston, Texas
As a burgeoning corporate and medical hub, Houston has experienced a tightening housing market. Home prices have increased by 25% over the past three years, based on data from the Houston Association of Realtors.
Housing affordability is essential to keeping a community balanced and inclusive so that all residents can benefit from the city’s growth.
Raleigh, North Carolina
Raleigh has quickly developed due to its thriving research and technology sectors attracting talent from around the globe. However, the supply of housing hasn’t been able to keep up. There has been a 24% increase in rental costs between 2020 and 2023, the Government Accountability Office noted.
New graduates and lower-income workers hoping to join the Raleigh community face this reality, which is something that requires strategic urban planning.
San Antonio, Texas
San Antonio remains relatively more affordable compared to other major Texas cities, but that trend is slowly shifting. The San Antonio Board of Realtors reports that home prices have climbed by 34% over the last four years, with rental rates not far behind.
As the city continues to grow, careful management will be needed to maintain its affordability and livability for a diverse population.
Miami, Florida
Miami has experienced one of the most significant cost-of-living increases in the country. Median rent prices skyrocketed by 45% from 2020 to 2023, positioning the city among the least affordable in the South, as per Zillow data.
This rapid upward trajectory—while welcomed by those who have called Miami home for decades—is also ringing alarm bells among new arrivals drawn to Miami’s vibrant lifestyle. It prompts demands for housing policy remedies that are targeted to the area’s specific needs.
Jacksonville, Florida
Demand for housing has exploded in Jacksonville thanks to its strategic location and appeal for remote workers. As housing prices increase, so does the worry about the long term affordability of this rapidly expanding city.
Ensuring sustainable growth will be key to maintaining Jacksonville’s attractiveness and accessibility.
Fort Worth, Texas
Many find the comparatively low cost of living a nice bonus of Fort Worth’s proximity to Dallas. RentCafe data show rental prices have skyrocketed almost 25% in the last three years, however.
This upward trend points towards potentially difficult affordability and the need to create balanced growth strategies to absorb new residents.
Charleston, South Carolina
It has become a destination for luxury home buyers and retirees who want Charleston’s coastal allure and historical charm, which in turn means demand for high-end properties. With median housing costs up 36% since 2019 due to this demand alone, it’s pushed many long time residents out.
With Charleston changing, one of the most important things to remember going forward will be to keep the city accessible and inclusive for all.
Birmingham, Alabama
Birmingham is still one of the most affordable cities on this list. However, its downtown has been revitalized and it is becoming an increasingly popular place to live thanks to its booming cultural scene. Housing prices in particular have grown 25 percent since 2020, boosted by a rise in demand for urban living and also due to the city’s economic diversification, Zillow reports.
Unless this trend is stopped, it can become unaffordable for the long term and could cause displacement of current residents who want affordable housing options.
New Orleans, Louisiana
Their historic properties and unique cultural experiences are so in demand that New Orleans faces serious affordability challenges. The city’s charm itself, its vibrant music scene, are also drawing tourists along with would be residents.
Rental prices have gone up 22 percent in just three years, Apartment List says. This is largely because housing in desirable neighborhoods is in short supply, and vacation rentals have been pulling properties off the market.
Richmond, Virginia
Richmond has become increasingly popular with remote workers and young professionals, creating a surge in housing competition. The city’s rich history, combined with its growing arts and culinary scenes, draws new residents.
Median home values climbed 28% between 2019 and 2023, creating barriers for first-time homebuyers who may struggle to find affordable options in a city known for its charming historic districts and burgeoning tech sector.
Chattanooga, Tennessee
With a growing economy and stunning natural beauty, Chattanooga has seen rent costs spike 30 percent during the past three years, according to Rent.com. Its outdoor activities and quality of life serve to attract new residents as well as new businesses.
Yet, the growth in this area has resulted in more people seeking housing and bids for the higher cost of rentals as well as the threat of exclusion of long term residents.
Savannah, Georgia
Savannah’s historical appeal and growth in tourism have driven up housing prices by 21% since 2020, as reported by Zillow. The city’s picturesque squares, historic architecture, and thriving arts scene make it a desirable place to live.
However, these rising costs may soon deter younger professionals and families from settling down here as they seek more affordable living arrangements in a landscape of rising property values and living expenses.
Little Rock, Arkansas
Little Rock has seen steady economic development, marked by a growing healthcare and tech sector and rising home prices. According to Realtor.com, housing costs climbed 18% in the last three years.
This trend is not expected to slow imminently as more businesses set up operations in the city, bringing in new residents who contribute to the increasing housing demand and, subsequently, higher home prices.
Greenville, South Carolina
Greenville represents a thriving Southern economy with a robust manufacturing sector and growing tech industry, but affordability is tightening. The Greenville Journal reports a 30% jump in housing prices over four years.
This increase is attributed to the city’s economic success and the attractiveness of its revitalized downtown, which draws both tourists and new residents seeking a lively urban experience.
Austin, Texas
It has become a tech hub and cultural magnet for businesses, entrepreneurs and remote workers, from all over the country. The population of Austin, famous for its music scene and taste for innovation, grew by 3.3 percent from 2010 to 2020, according to the Austin Chamber of Commerce. As such, this rapid growth has put a great demand on housing leading to limited supply.
Thus, median home prices increased 58%, from almost $300,000 to nearly $500,000, between 2020 and 2023. And this rise in housing costs also raises fears of displacing longtime residents, and threatens the city’s diversity and cultural richness.
Lexington, Kentucky
Lexington’s growing entrepreneurial scene and proximity to horse country have drawn newcomers, increasing demand for housing and driving up expenses. The average home value in Lexington, KY is $301468, up 4.4% over the past year, according to Zillow.
This growth, which attracted the city’s vibrant cultural scene and more new businesses, has also brought concern over long term affordability to local communities.
Atlanta, Georgia
Atlanta’s thriving economy, diverse population, and initially affordable real estate market have made it a magnet for newcomers seeking opportunity and community. Atlanta’s appeal has driven housing prices up by 60% over the past decade, according to RealWealth.
With a shortage of affordable housing initiatives, many lower- and middle-income earners are experiencing financial strain, posing questions about future accessibility for a broad range of residents.
Disclaimer – This list is solely the author’s opinion based on research and publicly available information.
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