15 Top Real Estate Markets for Millennial Buyers in 2022

If you or someone you know is thinking about moving right now, you're likely well-acquainted with the bevy of factors informing the current state of the real estate market.

After a period of extremely low inventory -- driven by catalysts ranging from a drastic decline in new home constructions to an increase in early-pandemic home purchases that significantly slashed the number of homes for sale -- we're starting to see movement in the opposite direction as the market continues to cool.

In fact, in some markets, housing inventory is moving nearer to pre-pandemic levels. This cooling effect on the housing market seemed inevitable to many. While some movement could be attributed partially to seasonality, steadily increasing interest rates this year -- coupled with the reality that home prices, while slowly starting to fall, are still highly elevated overall -- are two significant impetuses here.

In short, while more houses are available now than a year ago, rising interest rates infused into an already expensive housing market are resulting in fewer homes being bought and sold. And though millennials have faced their fair share of economic challenges compared to their predecessors, this generation has steadily comprised the lion's share of homebuyers in recent years.

Let's look at 15 top real estate markets with something to offer for every type of millennial buyer in 2022 and beyond.

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Nashville is Tennessee's largest city, with a population of roughly 700,000, and is known by nicknames like "The Birthplace of Country Music" and "Athens of the South." The city's millennial population has exploded, rising approximately 15% over the last several years and comprising more than 30% of the population as of 2019.

And Nashville's real estate market is hotter than ever: The median home price is around $450,000 at the time of this writing.

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Austin has a population of approximately one million and is another hub continuing to draw millennials from around the country. A study conducted by SmartAsset in 2021 found that millennials account for more than 30% of Austin's residents.

From Austin's hot music scene to its abundance of hiking trails to its nearly endless array of world-class museums, there's no shortage of activities and things to do for residents with all types of interests.

Just outside the nation's capital, Alexandria combines distinctive old-world charm with nearly unparalleled access to the sights, sounds, and bustle of Washington, D.C., for commuters and remote workers alike.

With a population of around 164,000, Alexandria's millennial population has jumped by more than 25% in recent years. From beautiful King Street to the skinniest house in America, Alexandria has its own set of charms, not to mention a marvelous coffee and food scene.

Homes in Alexandria are considered prime real estate, which carries a premium price tag. The average home sells for around $615,000 at the time of this article, with the median cost of living totaling about 40% more compared to the national average.

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Situated near the Southwest Florida coast, with its famed 400 miles of canals, Cape Coral has a population of around 200,000, the millennial generation comprising approximately 18%, according to a study by SmartAsset.

As if Cape Coral’s incredible culinary culture and beautiful beaches, parks, and nature preserves weren’t enough, the city is only a few hours’ drive from places like Palm Beach, Orlando, and Key Largo. Other cities, such as Naples or Sarasota, are even closer. The average cost of living for a family of four in Cape Coral is approximately $4,600 a month.

Metropolitan Salt Lake City is the capital and largest city in the Beehive State, with a population of approximately 1.3 million people. It also has one of the nation's most significant concentrations of millennials, with this generation representing about 30% of the total population.

Salt Lake City's housing market is one of many where home prices have risen significantly over the past year, the average home fetching about $580,000 at present.

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With a population bordering on 1.9 million within its metro, Indianapolis's millennials make up roughly one-quarter of that figure as of the last count. According to Payscale, Indianapolis' cost of living ranks approximately 9% below the national average, with the area's median sales price of homes coming in at around $250,000.

From the abundance of outdoor recreational activities its many nearby state parks offer to its rich arts and music scene, Indianapolis is a thriving city with plenty to offer residents of all ages.

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From the five lakes surrounding the Madison metro area to the plethora of hiking and biking trails and its must-experience culinary scene, this delightful city is far more than just a college town. Madison has a population of approximately 277,000 and a beautiful downtown area packed with museums, restaurants, and boutiques.

And the city is known as a top destination for millennials. In 2019, a report by the National Association of Realtors determined millennials comprised 75% of all individuals who had recently moved to Madison. The median home price in Madison hovers around $378,000 at the time of this writing.

While Fargo might be the first destination you consider when considering top markets for millennials, The Peace Garden State recently ranked in the top 10 states for homebuyers of this generation. The average sales price of a home sits at around $280,000 -- considerably lower than the national median home price of around $430,000.

Fargo's approximately 130,000 residents have plenty of things to see and do in their own backyard, from museums and wineries to beautiful hiking and ski trails. The city's proximity to neighboring Minnesota also allows for day trips to places like Itasca State Park or Minneapolis.

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The incredibly diverse culture of New Orleans offers something for everyone: Outstanding cuisine, a nearly unparalleled jazz scene, beautiful streets rich with history, stunning architecture, and numerous cafes, coffee shops, art galleries, and more are just the tip of the iceberg.

It's no wonder the city of nearly 400,000 continues to be popular among millennial buyers, despite an approximate 12% lower cost of living than the national average. The median sales price of a home in New Orleans is approximately $288,000.

Just a short distance from the state's border with California, Reno has a population of roughly 272,000 and is fondly nicknamed the "Biggest Little City in the World." A strong local economy, fantastic food scene, and great weather -- not to mention its proximity to incredible destinations like Lake Tahoe -- are huge draws for new buyers from around the country.

Reno's cost of living is about 8% higher than the national average, according to Payscale, and the average home price is approximately $600,000.

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With roughly one-quarter of its population of around 930,000 comprised of millennials, Columbus was a no-brainer addition to this list. Columbus has a lot to offer -- from Ohio State University and the city's fast-growing economy -- boosted by a wave of tech startups setting up shop in the heart of the city -- to its incredible access to nature and great food and drink scene.

Payscale estimates show Columbus's cost of living is about 8% below the national average. As the cherry on top, the average home in Columbus sells for approximately $280,000, considerably lower than the national median.

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Rhode Island may be the nation's smallest state, but its abundant charm and peak location in the heart of New England are huge draws for buyers of all ages, including millennials. The state's population hovers around 1.1 million and includes roughly 300,000 millennials -- nearly a third residing in Providence alone.

At the time of this article, Providence's median home sales price is $372,000. With Providence as your base, you are in a prime spot to explore the entirety of New England, as well as an easy day trip away from places like Mystic, Connecticut; Boston, Massachusetts; and nearby Newport, to name a few.

Atlanta's robust economy -- boosted by some of the world's largest companies and spanning industries from tech to healthcare -- continues to capture droves of millennials from around the country. Roughly 25% of Atlanta's residents are of the millennial generation. For context, the metropolitan area has a population of more than 6.1 million.

According to Payscale, the average cost of a home in Atlanta is approximately $410,000, and the city's cost of living eclipses the national average by 5%.

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The famed Research Triangle continues to draw homebuyers nationwide and globally, and Durham is no exception. The city's population of around 300,000 has been inundated with young professionals, which has helped boost its rapidly increasing number of millennial residents.

Despite this, estimates from Payscale show that the cost of living in Durham is still about 11% below the national average. Currently, Durham's average home listing price is around $410,000.

The final pick on today's list, St. Louis boasts a population of nearly 2.8 million in its metro area, which spans Missouri and Illinois. The cost of living in St. Louis also comes in below the national average -- by about 6%, according to Payscale. In addition, the median home price in St. Louis is $221,000.

From a wealth of museums and bevy of rooftop restaurants and bars to the famed Gateway Arch and the city's status as an emerging tech hub, St. Louis is a worthy contender for those contemplating a move.

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Leading economists have mixed opinions on what the housing market could look like heading into the final months of 2022 and into 2023. Some are predicting a continued glut of inventory with little movement in housing prices, while others are forecasting a complete correction and still others foresee a more stable state of affairs.

If you want to invest in real estate without buying a house, there are still plenty of opportunities available to you. From investing in real estate stocks and REITs to buying portions of real estate via crowdfunding platforms, you can build long-term wealth in the way that works best for you, your financial situation, and your personal finance objectives.

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