Why Madison is One of the Hottest Housing Markets in 2026

Redfin just released a brand-new report naming Madison, Wisconsin, one of the hottest housing markets in 2026, placing it alongside other surging Midwest cities like Minneapolis, Cleveland, and St. Louis.

As someone who watches these trends closely, I can tell you Madison’s boom isn’t random; it’s being driven by three key factors: affordability, climate stability, and population growth.

So what does this mean for buyers, sellers, and investors? Let me break it down for you.

1. Madison offers a rare combination of affordability and lifestyle quality. Unlike many major metros, it provides both a manageable cost of living and an appealing lifestyle.

Redfin points to Madison and the broader Great Lakes region as a safe haven for buyers, especially those leaving climate-risky areas prone to floods, fires, and sea-level rise. Even after a 5% price bump in 2025, the average single-family home value is still around $481,000, which remains below the national average.

For relocating families and millennials, this combination makes Madison particularly attractive.

2. Madison’s demand is growing faster than its housing supply. The city is projected to grow by 37% over the next 25 years, but historically, new housing hasn’t been added fast enough to meet demand.

This imbalance pushes higher-income buyers into lower-priced homes, crowding out lower-income buyers. The result is more competition, faster price increases, and a growing need to rethink how we build homes.

City leaders are exploring solutions like cottage courts, which are clusters of small homes around shared green space, to help fill this housing gap.

3. Climate migration is real. As insurance costs rise in flood-prone or wildfire-heavy areas, people are choosing safer metros. Madison is becoming one of these destinations.

While Wisconsin experiences climate shifts like summer wildfire smoke and extreme rainfall, it is far more stable than coastal areas, making it one of the most desirable inland locations in 2026.

Favorable mortgage rates boost Madison’s market. Adding to the appeal, mortgage rates have dipped below 6%, making more buyers ready to move now. This combination of affordability, population growth, and climate stability has made Madison a hot market for buyers, sellers, and investors.

If you’re thinking about buying, selling, or investing in Madison this year, timing matters. Understanding what’s happening in the market and having a clear plan can help you make better decisions. If you have questions or want help, our team is here. You can reach out to (608) 345-6594 or email info@holtrealestateteam.com. I hope this helped explain what’s happening in Madison and what to do next.