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How to compare two real estate markets

A useful city-to-city comparison cuts across five dimensions. Looking only at sticker price misses most of what actually shapes a buying decision; looking at everything paralyzes it. Here's the working order we use to evaluate any two markets, and the questions each dimension answers.

1. Price and price-per-square-foot

Start with median sale price for a baseline budget check — it's the headline most buyers anchor on. Then look at price-per-square-foot to normalize for home size. Two cities with identical median prices can have very different price-per-square-foot, which tells you whether you're paying for location, square footage, or both. Price-per-sqft also strips out mix shifts — a market where bigger homes happen to sell this month can look pricier on median while being flat on per-sqft.

2. Market velocity (days on market, supply, sale-to-list ratio)

Velocity tells you who has leverage at the negotiating table. Days on market under 30 typically means competitive bidding and waived contingencies; over 60 days suggests buyers have room to negotiate. Months of supply below 4 favors sellers, above 6 favors buyers, and 4-6 is balanced. The sale-to-list ratio closes the loop — anything consistently above 100% means homes are routinely selling for over asking price, which has direct implications for the offer strategy you'll need.

3. Direction and momentum (year-over-year change, ZHVI trend)

Direction matters more than absolute level when you're making a multi-year commitment. Year-over-year price change captures the most recent twelve months of movement. Pair it with the longer-horizon Zillow Home Value Index trend — ZHVI covers the typical home value across all homes (not just sales), so it's less swingy than the headline median sale price. A city with strong recent YoY but flat 5-year ZHVI tells a different story than one with steady appreciation across both windows.

4. Demographic and economic context

Median home price means little without the income context to support it. Look at median household income first — the price-to-income ratio (a 3-to-5x range is historically normal in the US; coastal metros can run 8x or higher) tells you whether the local economy actually supports current prices. Owner-occupancy rate is a useful stability signal: high owner-occupancy correlates with longer holding periods, less volatile prices, and more neighborhood continuity. Population growth closes out the picture — sustained inbound migration is one of the strongest tailwinds available to a housing market.

5. True cost of ownership (taxes, insurance, fees)

Sticker price alone misleads on monthly cost. Property tax rates vary dramatically by state — a home in Texas at $400K can carry $7,000-$10,000 a year in property taxes, while the same price in Hawaii might run under $1,500. Homeowners insurance spikes in coastal, wildfire-exposed, and tornado-prone regions; Florida and California premiums alone can swing monthly cost by hundreds of dollars. Add HOA fees for any property in a managed community, and the comparison shifts further. Always model the all-in monthly cost — principal, interest, taxes, insurance — not just the mortgage payment.

Once you've worked the five dimensions, use the mortgage calculator to model the payment scenario in each finalist city, then narrow to specific ZIPs within those cities for hyperlocal comparison. The city-level read shortlists; the ZIP-level read picks the actual target neighborhood.