Economic signs point to a slowdown in the country’s real estate market. Twenty-eight real estate analysts polled by Reuters in May predicted U.S. home prices would rise 10.3% this year based on the Case/Shiller index. While this estimate may sound promising, it is a far cry from the current rate of around 20%. This means that prices in some markets will undoubtedly fall.
According to April data from Realtor.com, housing demand continued to moderate as buyers had to factor in both rising home prices and rising mortgage rates. The average rate on a 30-year mortgage in the last week of May stood at 5.27%, according to Bankrate, more than double the rate of 2.5% at the end of 2021. During this Meanwhile, the median current home price rose in April to a new all-time high of $425,000, a 14% increase from a year ago.
Realtor.com data also shows that the number of listings being sold has decreased and new listings have increased. Inventory is expected to increase from last year in the coming weeks.
While the national housing market appears to remain strong, these conditions, which favor buyers, have begun to take hold in some markets, where house prices are under pressure. (Conversely, these are the metros where house prices have skyrocketed this year.)
To find U.S. cities where home prices are falling, 24/7 Wall St. reviewed the report from Realtor.com House prices have started to fall: here are the cities where they have fallen the most. Realtor.com looked at the year-over-year change in median list prices across the 100 largest metros in March, limiting the list to just one metro per state for geographic diversity. Cities are ranked from smallest drop in annual median listing price to largest.
While median list prices have fallen in these cities, some of the metros noted here reflect the national trend of fewer homes going up for sale and homes staying shorter on the market. In these cases, the reason for the lower median list price is often that smaller homes are coming to market.
Although nearly all of these housing markets had a strong two-year period of skyrocketing prices, the median list price in nearly every city on the list is well below Realtor’s national median list price. com in April. In many of these towns, some sellers are taking advantage of high prices and trying to sell their homes. In these markets, listings are higher and homes stay on the market longer. (Here are the States with worst foreclosure rates this year.)
Click here to see 10 US cities where house prices are falling