Home Prices Are Dropping in Dozens of Major Cities Across the Country

Are you waiting for the housing market to finally cool down? You might be in luck depending on where you live. Nationally, home prices look pretty stable at first glance. However, local numbers tell a very different story. Dozens of major American cities are seeing property values slip backward.

According to Fast Company, “nationally aggregated U.S. home prices are up 1% year over year between September 2025 and September 2026.” That tiny national uptick hides a major regional shift. Specifically, “66 of the nation’s 300 largest housing markets (i.e., 22% of markets) had a falling year-over-year home price reading” during that exact same window. The numbers come from a ResiClub analysis of the Zillow Home Value Index. Reporter Lance Lambert tracked these shifting metro trends for the publication.

Why are values suddenly dipping in so many places? Borrowing costs recently climbed higher again. Fast Company notes that “the recent jump in long-term yields and mortgage rates has coincided with a renewed acceleration in market softening.” Higher monthly payments push everyday buyers to the sidelines. When buyers pause their searches, listings sit on the market much longer. Sellers must then cut their asking prices to attract attention.

Builders are also shaking up the local real estate dynamic. Big construction companies want to keep moving their properties. They often offer mortgage rate buydowns and other perks that individual sellers cannot match. As Fast Company explains, “some buyers who might have previously opted for existing homes are instead choosing new construction with more attractive deals.” This trend “added further upward pressure to resale inventory growth over the past few years.”

This inventory jump hits certain Sun Belt states the hardest. Areas in Texas, Florida, and Colorado now hold more active listings than they did before the pandemic. More houses for sale means buyers have real leverage again. They do not have to waive inspections or enter wild bidding wars anymore. Instead, they can take their time and negotiate better terms.

What about the other 234 major markets across the country? Prices are still technically rising in those cities. Yet homeowners there are not necessarily getting ahead either. Fast Company points out that “most of the places posting ‘nominal gains’ are seeing gains below income growth and consumer price growth.” Economists refer to this hidden trend as “‘real’ (inflation-adjusted) home price declines.”

In simple terms, inflation is outpacing home equity growth in most cities. Even where price tags look slightly higher on paper, houses are becoming cheaper relative to wages. The housing market is slowly rebalancing itself after years of runaway growth. Whether you want a brand-new build or a resale fixer-upper, patience is finally paying off for house hunters.

Sources Used:

• Fast Company: 66 major housing markets now see falling prices – https://www.fastcompany.com/91632512/housing-market-66-major-markets-now-see-falling-prices
• ResiClub Analytics: The 106 major housing markets with year-over-year home price declines – https://www.resiclubanalytics.com/p/major-housing-markets-with-falling-home-prices-106-january-2026