Home prices are cooling nationwide. These 4 cities are leading the declines.
- The share of US homes seeing price declines has hit its highest level since 2022, Redfin said.
- Three of the four metro areas are in Texas, and the other is in Oregon.
More than 6% of US homes are seeing price declines, the biggest share since November 2022, according to a new Redfin report.
Four major US metros are spearheading this trend, three of which are based in Texas.
Home-sale prices declined the most in Austin, sliding by 2.9% on an annual basis. That's followed by San Antonio and Fort Worth, both with a 1.2% drop. Prices in Portland, Oregon slid 0.9%.
This is the first time since January that prices dropped in this many cities, the real-estate brokerage said. Even as nationwide housing prices continue to trek higher — notching a new all-time high average in May — the softening in those four metro areas could signal that broader price growth will soon soften.
At the same time, active listings are sitting on the market for longer, indicating waning demand. In part, that's as runaway home costs have priced out buyers: At least for Austin, Redfin cited near-record housing costs as the reason behind falling prices.
In an April report, the firm had already noted that the Texas market was host to a number of depreciating metros, a pattern also seen in Florida. In both states, the pandemic triggered heavy construction to make room for remote workers, who were attracted to these states due to their price advantage.
But now, some are moving away to more competitive metros, Redfin then said.
To be sure, housing supply is strained nationwide, adding to why US prices keep rising. Currently, US inventory holds just over 3 months worth of supply, where 4 to 5 months is considered a balanced market.
Potential homebuyers are still kept out by high mortgage rates as well, with the 30-year fixed rate above 7%. Although housing analysts expected it to fall to the 6% range through 2024, many now see the rate as unlikely to change this year.