Demand for Rust Belt real estate is booming as people look for affordable luxury alongside a stable pace of life and work
St Louis, Missouri, one of several Midwestern cities experiencing a housing boom. Photograph: Brittney Butler/Unsplash.
The Midwest has seen major booms in its housing markets for several years now. Midwestern cities have consistently ranked among the best places to live in the U.S. and places such as Cincinnati, Ohio; Milwaukee, Wisconsin; and St. Louis, Missouri, are experiencing large demand for luxury real estate with homes selling at a much faster rate than the national average. A list published by Realtor.com in August 2024 placed three Midwestern ZIP codes among 2024’s top 10 areas for real estate sales, where properties took an average of 13 days to sell—far quicker than the national average of 42.
Paul Handle, managing director of Mahler Sotheby’s International Realty based in Milwaukee, says that his region is currently undergoing a “renaissance of sorts” in terms of real estate. “Luxury buyers are increasingly looking at the Midwest because of the incredible value they receive compared with coastal cities. They can purchase expansive properties, often with unique architectural details or waterfront access, for a fraction of the cost they would pay in New York, Los Angeles or Miami. Beyond price, there’s the appeal of a slower pace of life, lower property taxes and more predictable environmental conditions.”
Milwaukee, Wisconsin | Mahler Sotheby’s International Realty
Midwestern states are also drawing a number of homebuyers who want to return to their roots. According to a report published by the National Association of Realtors in November 2024, 18% of homebuyers surveyed had moved back to an area in which they previously lived, and this was most common among those moving to the Midwest. For families, Midwestern cities offer excellent schools and an abundance of universities, as well as a pleasant climate for outdoor living.
Meanwhile, for those in the early and middle stages of their lives and careers, economic opportunities remain strong. A 2023 Forbes article noted that five of the top states for starting a business that year were Midwestern—Indiana, North Dakota, South Dakota, Illinois and Ohio. (Following this trend, Sotheby’s International Realty opened its first office in South Dakota in December 2024.) With a particular focus on the tech sector, the article drew a direct correlation between the relatively lower cost of living in these states and their desirability among those with the talent and ability to start new companies. It also pointed out that the local talent pool in these areas is bolstered by the presence of some of the country’s best universities.
Maple Grove, Minnesota | Lakes Sotheby’s International Realty
Rural Midwestern communities have seen a spike in population since 2020, when the pandemic shifted many people to remote working, but urban Midwestern locales have seen booms in both their populations and the job vacancies that predate the pandemic and are continuing to rise. In addition to population and jobs growth, the cities identified in this study—Cincinnati, Ohio; Columbus, Ohio; Des Moines, Iowa; Fargo, North Dakota; Grand Rapids, Michigan; Indianapolis, Indiana; Kansas City, Missouri; Lexington, Kentucky; Madison, Wisconsin; and Minneapolis–Saint Paul, Minnesota—also fared better in terms of GDP per capita and college-degree attainment.
“For those seeking cities with fewer of the challenges that come with larger metropolitan areas, several other exceptional options are available,” says Kathe Barge, associate broker and global real estate advisor, Piatt Sotheby’s International Realty in Pittsburgh, Pennsylvania. Speaking about her native Pittsburgh, Pennsylvania, Barge adds that “both the city and its surrounding suburbs are seeing a rise in high-end condominium developments and upscale residential communities, offering prospective buyers an appealing mix of historical charm and modern convenience. These new developments are elevating Pittsburgh’s reputation as a destination for luxury living, with a growing number of options for those seeking contemporary luxury amid the city’s rich cultural landscape.”
Milwaukee, Wisconsin | Mahler Sotheby’s International Realty
Barge says many of the newcomers she sees fall into three categories. The first is returning Millennials—those born between the early 1980s and the late 1990s—who were raised in the region, spent time elsewhere and are seeking a more manageable pace of life and more substantive real estate opportunities. Then there are people from the West Coast who are attracted by the region’s growing tech scene, affordable real estate, good schools and lower childcare costs. Finally, there are returning retirees, who left the region for work and are now “seeking the comfort of familiar surroundings, an affordable lifestyle and the benefit of not paying state income tax on retirement earnings.”
It is clear that the Midwest’s luxury market isn’t just about the cost of property; it is also about investing in a region poised for continued transformation and success. These communities allow their residents to look ahead toward carving out a stable future, with room to grow and a high-end lifestyle.
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