Big-City Prices Hit Small Towns, Squeezing Out Homebuyers

by Teresa Mettela

From the cobblestone streets of Nantucket, MA, to the mountain peaks of Jackson, WY, some of the country’s most scenic small towns are now carrying price tags that rival major cities. Once thought of as quiet getaways or second-home destinations, these communities have become some of the most competitive real estate markets in the nation.

A new LendingTree analysis reveals just how high values have climbed, with median prices in certain towns surpassing even those of big cities such as Los Angeles and San Jose, CA.

Topping LendingTree's list of most expensive towns are Nantucket ($1,387,000), Vineyard Haven, MA ($1,104,100), and Jackson ($954,600). Each of these destinations is known for its exclusivity, natural beauty, and high-end amenities—and their home prices now stand shoulder to shoulder with some of the country’s most competitive markets.

Nantucket edges out San Jose’s $1,342,700 median, Vineyard Haven nearly matches San Francisco’s $1,113,800, and Jackson surpasses Los Angeles, where the median is $825,300, according to the study.

The study, which looked at the U.S. Census Bureau 2023 American Community Survey five-year estimates, examined towns with populations between 10,000 and 50,000, comparing their median home values with those of the 50 largest metro areas. What it reveals is that small-town charm can carry a big price tag.

Local real estate professionals say those numbers reflect what they’re seeing on the ground.

According to the Realtor.com® August 2025 Housing Market Trends Report, the U.S. market overall has seen 22 straight months of inventory growth, and homes are taking longer to sell—signs of a cooling, more balanced market. But in high-demand towns like Nantucket, Vineyard Haven, and Jackson, tight supply and deep-pocketed buyers are keeping prices elevated.

“These highly desirable locales face high demand and tight supply, driving home prices higher," says Hannah Jones, senior economic research analyst at Realtor.com. "Places like Nantucket and Martha's Vineyard have a large share of homes that are only seasonally occupied, which both detracts from year-round housing supply and drives prices higher."

"Jackson, WY, is surrounded by federally protected land, which limits how much housing can be built, driving prices higher. In general, many of these areas are appealing due to their location and access to high-end amenities, like skiing, beaches, or national parks. These amenities attract high net worth buyers whose budget sets the standard, pricing out lower-earning households,” she adds.

For Wyoming in particular, the unique landscape and demand for second homes have reshaped the housing market.

"With so little land available, every listing is a needle in a haystack," Latham Jenkins, a Wyoming-based real estate agent, tells Realtor.com. "New construction can’t keep pace, so prices climb on existing inventory. Land-use regulations and conservation overlays protect the environment but also make supply nearly fixed, which means demand dictates pricing more than in a typical market."

That dynamic has serious consequences for locals.

“Median earners are priced out as costs outrun local wages, forcing more people to rent or leave. Essential workers face long, fragile commutes from farther-out areas. Household budgets get squeezed, reducing savings and community stability,” Jones says.

Real estate agents say they’re also seeing ripple effects across neighboring communities as displaced buyers look for more affordable options.

"The majority of buyers are out of state. Many are second-home or third-home owners coming from coastal markets like California, Texas, or New York," explains Jenkins.

"Local buyers are often priced out, though, some longtime residents benefit from equity built over generations. It’s increasingly a market shaped by national and global wealth."

Still, the ripple effects of these high price ranges extend beyond town limits. Neighboring communities often see economic benefits as displaced buyers seek alternatives.

“Priced-out demand spills into adjacent communities, boosting home values, small-business activity, and tax bases. New residents bring spending and support year-round services. But these benefits often come with faster price growth and mounting affordability strain next door,” Jones explains.

For homebuyers, the lesson is clear: Whether you’re considering a major metro or a coastal enclave, limited supply and luxury amenities drive competition. In the nation’s most expensive towns, those forces can make prices seem just as steep as in the big city.