The No. 1 emerging real-estate market in America also has some of the nation's best beaches

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The Emerging Housing Markets Index from The Wall Street Journal and Realtor.com analyzes the 300 largest metropolitan areas.

Vacation is all many of today’s home buyers have ever wanted — at least following two years of COVID-19. That strong demand is starting to turn popular getaway destinations into some of the most competitive housing markets in the country.

In the latest installment of the quarterly index released Tuesday, the region in and around Naples, Fla., came out on top. Located on Florida’s Gulf Coast, the region is considered to have some of the best beaches in the country. Many of these markets have a larger share of the population that is foreign-born, making them more potentially more attractive to foreign buyers. And most are within spitting distance of international airports, adding to their accessibility.

“People were visiting vacation rentals because they were further away from large groups — you weren’t running into a bunch of people in a hotel lobby,” Olds said. “So you saw a lot of folks do their first trip ever in an Airbnb ABNB, +3.15% or VRBO.” A recent report from Vacasa found that 46% of prospective second-home buyers were looking to generate income through the property they purchase, up from 32% of these buyers in 2019.

Outside of vacation destinations, the South and the Midwest remain attractive As the index’s fluctuations over the past four quarters has shown, the competitive real-estate market we see nationwide isn’t static. Some markets that previously ranked at the top of this index — including cities in Idaho and Montana — have attracted so many buyers that they aren’t really “emerging” any longer.

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