The US housing market is showing signs of cooling down, with home prices declining in many of America’s largest real estate markets. Miami is leading the downturn, experiencing a significant 12.4% drop in median listing prices compared to the previous year. This trend towards more affordable housing is spreading across the country, impacting markets from coast to coast.
According to Realtor.com’s September Housing Market Report, price declines are hitting major metropolitan areas, including San Francisco, Cincinnati, and cities across Florida. This shift comes amidst rising mortgage rates, following a recent dip last month.
Nationwide, the median home listing price has fallen to $425,000, marking a 1% decrease from two years ago. However, Realtor.com economist Joel Berner highlights a nuanced aspect of the data: “The median price per square foot grew by 2.3%, indicating that the inventory of smaller and more affordable homes continues to grow in share,” Berner said. This suggests that while overall prices are dropping, there’s an increasing availability of more affordable housing options.
Florida markets are particularly prominent on the list of price declines, with four cities among the top ten tracked by Realtor.com. Miami leads the pack with its 12.4% drop to $525,000, followed by Tampa (-5.5% to $414,948), Orlando (-5.6% to $429,950), and Jacksonville (-6.1% to $399,000). Robert Washington, owner of St. Petersburg-based Savvy Buyers Realty, attributes Florida’s market correction to post-pandemic factors. He explains that the remote work trend and the state’s tax benefits, including the absence of state income tax, have played a role in attracting new residents, potentially influencing the market shifts.
Beyond Florida, price drops are affecting major cities across multiple regions. Cincinnati saw the second-largest decline at 9.5%, bringing its median listing price to $337,000. San Francisco followed with an 8.9% decrease to $997,500, while Kansas City’s prices fell 8.4% to $389,500. Other once-hot markets experiencing price drops include Austin (-6.6% to $520,000), Denver (-6% to $610,250), and Nashville (-5.4% to $547,865).
While this trend presents potential relief for buyers facing affordability challenges, some markets like Miami still maintain prices significantly higher than pre-pandemic levels, with median listings 50% higher than 2019 figures. Nonetheless, the widespread price moderation affecting over half of the nation’s 50 largest markets signals a possible transition towards improved buyer conditions despite ongoing challenges with elevated mortgage rates. This shift in the housing market presents a dynamic landscape for both buyers and sellers, demanding careful consideration and informed decisions in navigating the current market conditions.