In another 13 bigger cities, prices fell by 9% to 10%. But San Francisco’s market goes haywire as AI mania money spills into housing.
By Wolf Richter for WOLF STREET.
Prices of mid-tier single-family homes have dropped by 11% to 26% seasonally adjusted in these 16 bigger cities and counties through September, from their respective peaks in prior years. For 14 of them, those peaks occurred in mid-2022; for two of them, the peaks occurred in 2024. These are major markets where the affordability crisis has softened a little.
| City or County, through Sept. 2026 | From peak | Year of peak | ||
| 1 | Austin | TX | -26% | 2022 |
| 2 | Oakland | CA | -23% | 2022 |
| 3 | New Orleans | LA | -20% | 2022 |
| 4 | Lee County (Cape Coral, Fort Myers) | FL | -18% | 2022 |
| 5 | Birmingham | AL | -17% | 2022 |
| 6 | Sarasota County | FL | -17% | 2022 |
| 7 | McKinney | TX | -14% | 2022 |
| 8 | Manhattan | NY | -14% | 2022 |
| 9 | Hayward | CA | -13% | 2022 |
| 10 | Washington | DC | -13% | 2022 |
| 11 | Contra Costa County (East Bay) | CA | -12% | 2022 |
| 12 | Denver | CO | -12% | 2022 |
| 13 | Phoenix | AZ | -11% | 2022 |
| 14 | Aurora | CO | -11% | 2024 |
| 15 | Collier County (Naples) | FL | -11% | 2024 |
| 16 | Fort Worth | TX | -11% | 2022 |
Texas has three entries on this list, including the #1 Austin. The other two are in the Dallas-Fort Worth area: McKinney (-14%) and Fort Worth (-11%). San Antonio (-10%), Dallas (-7%), Frisco (-10%), Garland (-9%), Plano (-9%), Arlington (-7%), Katy (-7%), and Houston (-6%) are included in the list below of those cities where prices dropped by less than 11%.
Florida has three markets on this list (2 counties and 1 city). The cities in these two counties – some of them well-known cities – are too small to make the list on their own. The single-family market in Florida isn’t nearly as weak as the condo market.
California has three markets on the list: #2 Oakland (-23%); Hayward (-13%) on the eastern shore of the San Francisco Bay; and Contra Costa County (-12%) in the East Bay, comprising Concord, Antioch, Pittsburg, Walnut Creek, Richmond, San Ramon, and many other smaller cities.
But the City of San Francisco, which had been #4 on this list in July 2025 with a decline of 15%, has come off the list earlier this year as the housing market suddenly got flooded with the enormous amounts of money that the massively money-losing AI companies in the City, topped by OpenAI and Anthropic, are paying their people, who are throwing this money around left and right, willy-nilly, a relatively small number of them, but with suddenly lots of money, and the housing market – both for sale and rental – has gone absolutely haywire. This is where some of the money that investors plowed into these companies has ended up.
At this crazy pace (+2.2% month-to-month, +17% year-over-year), the price of a mid-tier single-family home ($1.62 million in September) will surpass the 2022 high and set a new high in a month or two. Prices are up by nearly 300% since 2000.
The cities that didn’t make the 11% cutoff:
There are many other bigger cities where mid-tier single-family home prices have declined from their respective peaks in prior years, but by less than 11%. Here is a sample:
| City | From peak | Year of peak | ||
| 1 | San Antonio | TX | -10% | 2022 |
| 2 | Glendale | AZ | -10% | 2022 |
| 3 | Chandler | AZ | -10% | 2022 |
| 4 | Frisco | TX | -10% | 2022 |
| 5 | St. Petersburg | FL | -10% | 2024 |
| 6 | Memphis | TN | -9% | 2022 |
| 7 | Mesa | AZ | -9% | 2022 |
| 8 | Garland | TX | -9% | 2024 |
| 9 | Seattle | WA | -9% | 2022 |
| 10 | Sacramento | CA | -9% | 2022 |
| 11 | Portland | OR | -9% | 2022 |
| 12 | Plano | TX | -9% | 2024 |
| 13 | Gilbert | AZ | -9% | 2022 |
| 14 | Colorado Springs | CO | -8% | 2022 |
| 15 | Stockton | CA | -8% | 2022 |
| 16 | Arlington | TX | -7% | 2022 |
| 17 | Katy | TX | -7% | 2022 |
| 18 | Dallas | TX | -7% | 2024 |
| 19 | Atlanta | GA | -6% | 2022 |
| 20 | Fremont | CA | -6% | 2025 |
| 21 | Port Saint Lucie | FL | -6% | 2022 |
| 22 | Boston | MA | -6% | 2025 |
| 23 | Lakeland | FL | -6% | 2024 |
| 24 | Tampa | FL | -6% | 2024 |
| 25 | Houston | TX | -6% | 2024 |
| 26 | Durham | NC | -5% | 2024 |
| 27 | Orlando | FL | -5% | 2024 |
| 28 | Salt Lake City | UT | -5% | 2022 |
| 29 | Tucson | AZ | -5% | 2024 |
| 30 | Spokane | WA | -5% | 2022 |
| 31 | San Jose | CA | -5% | 2025 |
| 32 | Jacksonville | FL | -5% | 2024 |
| 33 | Boise | ID | -5% | 2022 |
| 34 | Las Vegas | NV | -5% | 2025 |
| 35 | Henderson | NV | -5% | 2022 |
| 36 | Raleigh | NC | -4% | 2022 |
| 37 | San Diego | CA | -4% | 2024 |
| 38 | Nashville | TN | -4% | 2023 |
| 39 | Los Angeles | CA | -4% | 2024 |
Methodology and data: These prices are seasonally adjusted three-month averages of single-family mid-tier homes in “cities” or “counties.” All data here are from the Zillow Home Value Index (ZHVI), which is based on millions of data points in Zillow’s “Database of All Homes,” including from public records (tax data), MLS, brokerages, local Realtor Associations, real-estate agents, and households across the US. It includes pricing data for off-market deals and for-sale-by-owner deals. These are not median prices.
The 16 bigger cities with price declines of 11% to 26%:
The metrics in each table from left to right: price decline from the peak, month-over-month change (MoM), year-over-year change (YoY), and the remaining increase since January 2000.
| Austin, City, Single-Family Home Prices | |||
| From Jun 2022 peak | MoM | YoY | Since 2000 |
| -26% | 0.3% | -2.8% | 159% |
| Oakland, City, Single-Family Home Prices | |||
| From May 2022 peak | MoM | YoY | Since 2000 |
| -23% | 0.6% | 2.2% | 286% |
| New Orleans, City, Single-Family Home Prices | |||
| From Jun 2022 peak | MoM | YoY | Since 2007 |
| -20% | 0.1% | -2.1% | 103% |
| Lee County, FL, Single-Family Home Prices | |||
| From Aug 2022 peak | MoM | YoY | Since 2000 |
| -18% | 0.0% | -3.2% | 181% |
| Birmingham, AL, City, Single-Family Home Prices | |||
| From Jul 2022 peak | MoM | YoY | Since 2002 |
| -17% | 0.2% | -2.5% | 32% |
| Sarasota County, FL, Single-Family Home Prices | |||
| From Aug 2022 peak | MoM | YoY | Since 2000 |
| -17% | 0.4% | -1.6% | 211% |
| McKinney, TX, City, Single-Family Home Prices | |||
| From Aug 2022 peak | MoM | YoY | Since 2000 |
| -14% | 0.2% | -5.1% | 150% |
| Manhattan (New York County), NY, Single-Family Home Prices | |||
| From Jun 2022 peak | MoM | YoY | Since 2000 |
| -14% | 0.5% | 3.5% | 304% |
| Hayward, CA, City, Single-Family Home Prices | |||
| From Aug 2022 peak | MoM | YoY | Since 2000 |
| -13% | 0.1% | -2% | 265% |
| Washington D.C., Single-Family Home Prices | |||
| From Jun 2022 peak | MoM | YoY | Since 2000 |
| -13% | 0.3% | 0.1% | 272% |
| Contra Costa County, CA, Single-Family Home Prices | |||
| From Jun 2022 peak | MoM | YoY | Since 2000 |
| -12% | 0.2% | -0.3% | 192% |
| Denver, City, Single-Family Home Prices | |||
| From Jun 2022 peak | MoM | YoY | Since 2000 |
| -12% | 0.2% | -1.5% | 207% |
| Phoenix, City, Single-Family Home Prices | |||
| From Jul 2022 peak | MoM | YoY | Since 2000 |
| -11% | 0.0% | -1.1% | 244% |
| Aurora, CO, City, Single-Family Home Prices | |||
| From May 2024 peak | MoM | YoY | Since 2000 |
| -11% | 0.0% | -2.4% | 189% |
| Collier County, FL, Single-Family Home Prices | |||
| From Mar 2024 peak | MoM | YoY | Since 2000 |
| -11% | 0.4% | -0.8% | 241% |
| Fort Worth, City, Single-Family Home Prices | |||
| From Aug 2022 peak | MoM | YoY | Since 2000 |
| -11% | 0.0% | -1.6% | 186% |
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Thanks WR,
Good to see San Diego aka SD in the list. Slowly but surely prices are going down from insane levels.
Yes. Insanity pricing was the order of the day until recently. But the slow decrease seems to be consistent. Only a recession would accelerate that pace.
And San Francisco once again bucks the trend. Amazing they could have price increases in this environment. The Phoenix once again rises from the ashes. That city is so resilient.
But as Wolf noted, those increases are partially/mainly due to enormous AI investments. SF housing prices will be impacted when that gravy train slows down.
Jon, as someone who is watching the SD home market closely while we rent, it’s fascinating to see what appears to be a “support” level of prices in San Diego. In the area bounded by the 78, the 15, and the 8, there seems to be resistance to decrease the price of a 3 BD under $1M. It’s slowly eroding in the Serra Mesa and Clairemont areas, but it feels as if sellers see $1M as the magic number and refuse to go below it. I can’t remember a house that was initially priced above $1M cross that barrier. They usually just get delisted.
It’s the same up the 15 in RB/4S area. Seems nothing is going to list below $1.4M and owners will rather hold on and stay put then sell. So frustrating.
Wolf,
Looking at the charts, the majority seem to have the same slight tick up at the edge of the right hand margin (less Fort Worth, for example). What happened to cause this correlation?
So this is seasonally adjusted data. Seasonally, home prices decline in the fall and rise in the spring in most markets. Seasonal adjustments attempt to reverse that seasonal change, with a positive factor in the fall (pushing up the price) and a negative factor in the spring (pushing down the price). They look to be a little aggressive to me. The distortions during the 2020-2022 period have messed up a lot of seasonal adjustments.
By contrast, when looking at the “raw” not-seasonally adjusted metro data, prices dipped in September essentially across the board and for the US overall.
But seasonal adjustments should add up to 1 over the year. So if one is overstated, it will be balanced out by others later. And they might have been a little overstated in the spring in the other direction when we saw some very sharp declines seasonally adjusted.
Ignore the seasonal mal-adjusted data. Watch what the economy is actually doing.
I remember in 2022 when I was still willing to suffer the idiocy of reddit (I’ve since killed the acct and stopped going there), how some Phoenix used-house-salesguy on the housing bubble sub claimed housing there would never drop due to “reasons”. Remain skeptical any time sales-peeps open their mouths.
Is it cool to be anti Reddit in some circles?
It’s just a forum for the most part.
I like it to read what’s going on but it is heavily moderated.
Seems pretty spot on here in FL. I’m in the Orlando area and the chart showing down 5% from peak in 2024 is what I’m seeing regularly. Market here is stubborn…jobs are garbage so not many can afford both the high prices and high rates except a few.
McKinney TX is on high on the list because of the changes in H1b rules. McKinney has a lot of H1bs, it’s a north suburb of Dallas.
McKinney was one of the fastest growing cities in the US. And so homebuilders built and sold single-family homes in massive numbers, and they’re selling them, and they’re cutting prices, and buying down mortgage rates, etc. And that’s the competition for homeowners.
Lennar says on its site that it has 696 homes spread across 96 developments in McKinney. A bunch of them are advertised for $170k-$190k (I’m going to get a bunch of complainers here dissing them because they’re 1,600 sf and on a “postage size” lot, but that’s a starter home, of which the US doesn’t have nearly enough. $200-$300k lots of choice, 475 houses. Homeowners have no idea what they’re up against.
Thanks for that info, Wolf. And agree with previous poster also as I am familiar with, lived and worked in Dallas for a couple of years (came back to Los Angeles, of which I wish to leave again as LA is what it is — even if I can afford a small condo, I do not wish to stay. I feel it has a dangerous vibe now.). I always loved Frisco, Plano and northern suburbs of D but my office was in Uptown D, and I was semi-terrified of driving the toll (still have TX toll tag on my car that I purchased in Richardson)! I rented in north D.
Your comment that there are $170k+ small homes on small lots sent me right to Zillow as that is up my alley. I gave up of looking in TX as most homes are giant. A few months ago drove partway through TX (Amarillo), made boneheaded move out in the country as I missed fwy entrance (it looked like a driveway lol), and was greeted by a beautiful young woman with that wonderful TX drawl who stopped to ask if I needed help. (I am female also). I just love the friendliness and hospitality.
“A bunch of them are advertised for $170k-$190k”
That’s a dream price for anything in my neck of NC. There is a Lennar community that recently finished building out homes that size and they are 320-370k with basement lots (unfinished) going for 400k+. Only thing you can find under 200k is either a manufactured that needs major work or an old 600-800sqft block house that also needs work.
Yes, living in Texas has its advantages.
And the party is just getting started.
(Nice to see you on YouTube on Thoughtful Money)
What fraction of all the relevant “Cities” or “Counties” in the Zillow Home Value Index (ZHVI) are now showing price declines? I remember in 2005 there were scattered house price declines, with condos leading the way as usual. Then in 2006 they were more widespread, but it wasn’t until late 2007 that it became a national problem, and it wasn’t a crisis until late 2008. Right now it feels like the equivalent of late 2006 or early 2007.
P.S. If the San Francisco rebound story were purely about AI, shouldn’t one expect Oakland, Fremont, Contra Costa County, Hayward and San Jose to be doing better?
These are among the largest cities. But I summarized a bunch of decliners by using counties, including Contra Costa County, which has a lot of smaller cities. The county itself has a population of 1.2 million. So in that group of bigger cities, just cities, there would be many more if I hadn’t grouped them into counties.
I included two lists totaling 55 cities/counties with declines of 4% to 34%. There are another 17 cities among the bigger cities with declines from prior years of 1-3%. So there are 73 bigger cities with declines from prior years in that group.
The national index for September was up 1.0% year-over-year, the smallest year-over-year increase since May. The raw index declined 0.4% in September from August. The seasonally adjusted index was about flat in September.
This is how it has been for a few years: price declines spreading across more markets, while prices are stable or increase in the other markets.
The national overall figures demonstrate that. They have vacillated between being slightly negative yoy (mid-2023 and mid-2025) and slightly positive yoy the rest of the time (+1% in September).
A little while ago, I pointed out some of the big markets with gains, such as parts of the East Coast, the Chicago area, and a lot of cities like Toledo, Milwaukee, etc. Orange County in CA is one of the few major places in CA with home prices still setting new highs.
The Oakland market being so insulated from the SF price gouging has always been hilarious to me. The municipal mismanagement is so bad that people aren’t don’t even consider the fractional housing costs and the arguably better commute by Bart.
Keep Oakland Scary.
Oakland is to SF, what Newark is to Manhattan.
New housing has some drama to with the Lennar / Millrose situation. Not sure buying your own homes is illegal but seems to be some interesting accounting as well. At least they made their targets and SEC information was updated. Does feel a lot like AI financing just on a much smaller scale.
Peter Schiff had a very sobering video in thr last few days. In it he says –
“And how long do you think real estate prices are going to withstand rising mortgage rates?….Fannie and Freddy are about 80% below their highs from last year. The housing market is a disaster waiting to happen. Prices are going to have to implode for real estate. And the entire sector is basically almost in a depression…”
Now, eventually something has to give, and the only thing that can give is the sellers. They have to capitulate and lower their prices. So the only way that homes are going to sell is at lower prices. And the minute that happens, now you’ve got a crisis, because you wipe out everybody’s equity.
Well that’s a problem that QE made which is why it should never ever be done again.
But the difference is that banks don’t seem to have 35-40 billion$ in underwater RE CDOs as they had in 2008, famously causing the destruction of Lehman and Merrill Lynch (the latter survived only by merging with BofA, and they almost collapsed because of how bad shape ML was in).
So you can’t expect history to repeat the same way even though RE is in a downturn.
Homeowner equity is much higher than Bubble 1 (71%, at all-time highs), and amount owed is much less (comparable to the 1990s). We won’t see a repeat of 2006.
Spokane/North Idaho reporting in.
Lots of half finished flips being listed, lots of dreamers still, some decent deals. Bottom end of the market inventory starting to come back. Survivalist shacks aren’t 500k anymore usually. Idaho side is still overpriced for obvious reasons aside from Silver Valley but E. WA is getting better. Might get into the housing market after 6 years of being sidelined this winter. Stonks are too risky for me atm, cash is horrific to hold right now. I want to see how these AI IPOs play out and where the fed/10 year goes.
It is also some of the most beautiful countryside in the US. Low density. Enjoy!
so here in Tucson, my CU whom I have heloc with ‘notified’ me my house value dropped $50k
but in 2 years I’ve had it, I’ve paid down mortgage more than $50k
I haven’t used heloc yet as it’s for REAL INVESTMENTS with conservative 15% ROI(more like 30%)
but I don’t see list prices dropping in homes we’re looking to downsize into
but banksters are grifters 1st
Thank you Wolf for all that you do! Just spent my Friday evening watching you on Thoughtful Money, you were great. The look of cognitive dissonance on Adam’s face was priceless. Loved your thoughts on precious metals at the end, it made total sense. I bought big in precious metals in 2018 with all the doom talk going on, and I was holding it until I could make a trade for weapons with Mad Max in BarterTown. But reading Wolfstreet has given me a different perspective and I sold the metals at their high earlier this year and put the cash in a cd. I would have never done this without Wolfstreet! If this move was right or wrong isn’t what’s important. What matters is I don’t feel like I’m making financial decisions from inside a bunker. Cheers!
Thank you for mentioning that Wolf was on Thoughtful Money. I watched it and enjoyed the financial discourse. Very interesting discussion!
The condo I sold in Alameda County, California has had a nominal appreciation of less than 2% annually since I sold it in 2019. Inflation adjusted, the buyers are now deeply underwater. The Zestimate has fallen from $798K to $711K over the last 12 months. It’s not looking good for condos, even in the SF Bay Area.
soon to be bankster owned REO
Just look at not only how massive this 2nd housing bubble is compared to the first, but the duration. The FED is a disgusting entity for what they did. Just despicable.
You can blame this year’s Noble Prize winner Michael Wood, who wrote “Interest and Prices”. He left out money!
It’s weird to include Manhattan on this list. I count 24783 residential sales in Manhattan over the last 12 months. Of those, 172 were single family homes, or 0.68%.
https://www.nyc.gov/assets/finance/downloads/pdf/rolling_sales/rollingsales_manhattan.pdf
It’s not weird, it’s symmetry. Manhattan is on both lists, single-family and condo/co-op. Here is the condo/co-op. Mid-tier condo/co-op prices: -17% from the 2022 high:
Happy?
Living in Oakland right now is an exercise in pure frustration. Homeowners face aging infrastructure and high upkeep costs, while local residents everywhere deal with the relentless tax of property crime, from daily car break-ins to the steady departure of long-standing local businesses driven out by theft and dropping foot traffic. It’s the silicon valley slum.
I sold my house in 2018 on Grizzly Peak Blvd in Berkeley Hills. Redfin now values it only 9% above sale price. Over 8 years! It surprised me…that stretch of GPB has huge lots flush with redwood groves and panoramic views of the entire SF Bay.
I used to run up to Grizzly Peak from the lowlands. Such a beautiful place that it was worth the absolutely brutal uphill.
Moved from Denver to Sarasota County in late 2021. Traded one overpriced home for another, though you can get a much better home in Sarasota County than in Denver for the same price. Sarasota County has adjusted more than Denver by -5% since mid-2022. So I guess I should have stayed in Denver (LOL).
I was a cash buyer, so lower prices really don’t matter to me as I don’t plan to sell and maybe I will get some property tax relief if the county doesn’t increase the mill levy. I rode the Denver market up and can ride the Sarasota Cty market down. A house is a place to live. I like mine.
Oh Denver will drop further than Sarasota, it has more price reductions than any other large city in the US at the moment and the inventory numbers are awful. What’s kept housing prices where they are is people pulling the listings thinking soon as rates drop prices are going to take off again – I literally hear people say their house is going to double again…
Tourism is down, we overbuilt rental units and rent is falling (although it still has a way to go before it’s affordable too). Most airbnbs are losing moving. Oh and we just passed super protective tenant laws that make being a landlord here really unappealing. You cannot choose not to renew a tenants lease as long as they have paid their rent. So just give it time….. so many vacant properties here.
And despite the super el nino stuff Vail resorts seems to be paying weather men to promote, i70 resorts are likely getting missed again. The weather pattern looks much more likely to hit Southwest CO.
I remember buying a lift ticket for Cooper Mountain in 1981 for $18. Must be at least 10 times that amount now. Old little dumps near downtown were selling for over $650K when I left. Good times.
I was just thinking today that almost every tangible commodity gets spiked upward at some point.
Some boring thing like coffee or old CDs or cassettes, prob going to go thru some renaissance and spike the price 500%.
It’s just silly
“When rates drop” – haha the reality check still hasn’t set in for Denver’s delusional sellers. I wouldn’t expect falling rates anytime soon with this explosive inflation.
“I rode the Denver market up and can ride the Sarasota Cty market down. ”
This will be the story for the majority. Same with the stock market. Perhpas 5%-10% can exit without prices crashing.
I live in SW Florida, specifically in Fort Myers. I have lived here for 9 years and I have lived in Florida for over 30 years. Let me address the 3 counties that made the “naughty” list.
Sarasota county is a very desirable place to live especially for retirees. As a matter of fact, when I was looking for retirement destinations over a decade ago, Sarasota and it’s surrounding communities like Venice and Bradenton were on my radar. However, even back then the desirable areas were a little pricey and the affordable areas were not in good neighborhoods. So, I moved further South.
Collier County, I can tell you from 30 years of visiting and travelling through Naples and the surrounding region, is a bipolar area. The Naples area West of I-75 is the richer, more prosperous older area. The neighborhoods East of I-75 are poorer, mostly working class people supporting the rich in the Western part of Naples. Then you have places like Immokalee and Ave Maria, which are islands to themselves. The former very poor except for the Seminole Casino. The latter, more upscale, but disassociated from the remainder of Collier County.
Finally, let’s talk about Lee County where I bought my retirement home 9.5 years ago in the City of Fort Myers. This area is mainly a tale of 2 cities: Fort Myers and Cape Coral, both of which have very different characters and are only separated by the Caloosahatchee river. We won’t discuss Lehigh Acres, FM Beach or North FM, since they are not major metropolitan districts.
Fort Myers is the older, establish in 1886, mid-size city with a thriving downtown on the river waterfront and city limits that span out 5 miles from the City Center where City and County government buildings reside. I am barely inside City limits. Homes around me are selling, but at a much greater discount than during the meth-fueled, pandemic years where some of my neighbors bought homes unseen and forwent inspections. Homes are selling at 25% to 30% lower than the pandemic fueled insanity.
Cape Coral is doing much worse and is a much newer city. Cape Coral began as a planned community in the late 1950s with the idea of building residences around a network of canals. It was not formally incorporated until 1970. Downtown Cape Coral reflects the charm and character harkening back to the 1950s and 1960s. However, the Western, North-Western and Northern parts are cookie-cutter neighborhoods.
Cape Coral development continues to grow in the North and Northwestern areas where there is available, abundant, undeveloped land. These new homes started planning during the pandemic and are now coming out of the pipeline. With freebies and financial incentives from developers, the existing home market in the Cape Coral area is taking a huge hit. Additionally, there are many, many condos in Cape Coral where condo prices have nose dived thanks to what happened in SW Florida with the condo collapse and new regulations passed by Tallahassee. Fort Myers condo market is also affected, but not to the extent of Cape Coral’s condo market.
Fort Myers Beach is still recovering 4 years later from Hurricane Ian, which devasted that township (it’s not part of Fort Myers). Sanibel and Captiva Islands are in that same boat, but they appear to have a more loyal tourism pipeline than FMB.
I love this area, but I was considering selling my house (it was on the market for a year) of moving closer to my sister in Southern Illinois, where homes are half the price as mine. However, I wasn’t going to give my house away. It’s paid off and it’s my retirement haven. I’ve decided to live here and after I pass it will go to my daughter.
I’ve lived in Florida for 30 years and the real-estate market is hugely cyclical. Since this is a retirement destination, the numbers for real-estate sales can be skewed. Right now due to the current administrations stance on Canada a lot of Canadians are not purchasing winter residences down here in Florida or some are even selling and leaving Florida forever.
In the long term, the Florida real-estate market will continue to recover and grow. However, the two wild cards are demographics and hurricanes. We have had 3 major hurricanes in 9 years and insurance has gone ballistic. Secondly, we have a large aging population and baby-boomers like me are sitting on a lot of equity. What happens when we start to die out in large numbers? The value of my house will not come down after I die. It’ll be up to my daughter to keep it, sell it or rent it out. Cheers from SW Florida. Good luck and thanks for all the fish.
Finally some movement in and around Boston. There is hope.
The ‘this old house’ fellas need some work!
Lol, love that show. Just a bit expensive for the average person.
I learned to hate this old shack when I found out any contractor on the show not a regular was a pay to play deal,basically a nationwide ad for your outfit(done with stolen taxpayer monies in part).
The debacle gig in London decades back was epic!
Wolf, house price inflation was already outrunning other measures of consumer inflation, before the pandemic-induced “second housing bubble”. It would be helpful to separate the affects of “excess house price inflation” from “bubble-induced”. I live in an area of NJ where the latter was modest. Perhaps showing the data you have been, also housing-inflation-adjusted, and consumer-inflation-adjusted.
I know you don’t like Case Shiller indices (and I largely agree), but for additional context:
Inflation adjusted national Case-Shiller is unchanged since the peak in May 2022. That level is roughly double what it was during the 1990s.
Inflation adjusted Seattle Case-Shiller is down 15% from the peak in May 2022, but mostly moving sideways in the last 3 years. That level is roughly 2.5 times what it was during the 1990s.
In 1989, inflation adjusted prices peaked, then went on a long slow decline by ~15% over the next 7 years. It didn’t surpass its 1989 peak until 2000. I’d look for something similar here: another 4-7 years of flat to slightly declining prices.
Incomes will never catch up with record housing prices. They may narrow the gap but will never make housing as affordable.
“Home prices are ~5× median household income nationally.”
Everytime someone posts that, I post the same thing: people don’t care about house prices because they don’t pay house prices. They care about monthly payments because they pay monthly payments.
The current affordability index is 105, which is low, but only about 15% lower than it was throughout the 90s. It would only take a 15% drop in prices or a 15% increase in income to get back to something that everyone used to think was normal.
It will likely be a very long time before they return to Great Recession levels, because housing affordability in 2008-2020 were some of the lowest in history, all because of the historically low interest rates that everyone here hates with a passion.
Maybe you mean “most people.” I bought my first (and so far only) house back in 2024 in cash. Never had a mortgage nor do I want one ever so prices matter to me. All updates on the house also cash so not heloc/refi or whatever pretend games go on for those that can’t really afford their homes. I do watch home prices as I do want a nicer home in the future…hopefully they stay flat for 5-10 years as I continue to save up to buy that one cash as well.
Of course! You do you!
Paying cash vs. financing is both a financial calculation and a personal lifestyle choice.
My personal choice has been to never buy a house. I like renting, I like moving periodically, I hate maintenance, and in my city renting is a better financial choice than buying.
I think the younger American generations have apathy for not being able to afford to buy a homes They are content living in their loving parents homes. There is youth revolution or uprising happening around the world. Maybe it’s just a delay here until affordability hits home for them. Job opportunities are plentiful here maybe that’s keeping them happy.
They’ve agreed not to compete in the idiocy.
Maybe it’s a choice, maybe it’s a mantra.
Give them an opening and they’ll tear each other’s throats out to get a good price!
All of these people sitting in houses will have to sell them to someone, at some point. And if the next generation doesn’t have the money, guess what? Prices come down until the houses become affordable. Don’t get me started on “job opportunities”, LOL, when wage growth is beneath inflation and “entry level” jobs require two years of experience for an interview. In NC where I live, “entry level” jobs peak out at $15.39/hr, or less than I made when I got out of undergrad 40 years ago. I’ve got a family member with a B.S. in environmental science and 3.75 GPA who hasn’t gotten a job interview in six months.
Oh wow, the cities that won bigly based on Covid & WFH tends by levered buyers are losing bigly. Who could have possibly seen this coming???
Lol, don’t buy tops with borrowed money. “Shortages” are almost always…lol, transitory…while inflation tends to be sticky.
i must say you do a great job of consolidating so much data into very easy to understand charts and your analysis. i’ve been a stock trader since the 1970s and small time 20 doors at a time, r/e investor since the 1980s. hat tip to you. i sold off my last tranche in 2022 in AZ. i’ll wait until cap rates make sense again.
I have to assume that because Charlotte (#14 metro in US) isn’t on this list anywhere, that housing prices are still rising(?)
But the assumption is wrong. The cut-off for the second list is -4%. A decline from peak of less than 4% is not listed. Charlotte is in 42nd place on my list. The list you see cuts off after 39 cities (last one is Los Angeles).
Charlotte: -3% from the peak in 2024, -1.2% yoy, -0.1% mom, seasonally adjusted.