Home prices are declining year-over-year in 89 major US housing markets. Misryoum breaks down what’s behind the regional cooling and how buyers may be affected.
Housing is shifting again. Across the U.S., 89 of the 300 largest metro housing markets are now seeing year-over-year price declines—signaling a more uneven, region-by-region market than the national headline suggests.
The national pace is cooling, but not collapsing.. Misryoum analysis shows U.S.. home prices are up just +0.8% year-over-year between March 2025 and March 2026, down from +1.2% a year earlier.. After briefly hovering near flat territory in late 2025. the year-over-year figure has ticked higher—but the distribution of gains and losses across cities is what’s really changing.
Why 89 markets are falling: supply, affordability, and a post-boom reset
The story begins with how quickly supply and demand moved relative to each other.. In the first half of 2025, Misryoum notes the number of major metro areas showing year-over-year declines rose notably.. The reason is largely structural: inventory conditions improved for buyers. and that shift took hold faster in some regions than others.
By the second half of 2025, the pace of deterioration appears to have leveled off.. The count of declining markets stopped climbing, and the momentum behind inventory growth also slowed.. That matters because home prices typically respond not only to how much supply exists. but to how quickly the market gets more “buyer-friendly.”
In other words, the market didn’t swing from “hot” to “cold” everywhere at once—it cooled unevenly. Misryoum research points to a stabilizing pattern: fewer markets are worsening at the same rate, even as many still carry the weight of earlier price surges.
The Sun Belt and Mountain West are doing the heavy lifting
The softness is concentrated in specific geographies.. Many of the markets seeing the most weakness—where buyers gained leverage—are in Sun Belt regions. especially the Gulf Coast and the Mountain West.. Misryoum analysis connects this to two overlapping forces: pandemic-era overreach and a faster rise in competitive options.
During the housing boom, several Sun Belt markets recorded price growth that outpaced local income fundamentals. When domestic migration slowed and mortgage rates rose in 2022, the support under those price levels weakened. The result was a more difficult environment for sustaining “frothy” pricing.
There’s also a supply channel here that often gets overlooked in simple headlines.. Builders responded to demand during the boom years by adding new housing.. Later, when affordability tightened, those new homes became a real alternative to resales.. Builders can also use price reductions and affordability incentives to keep sales moving. which cools resale pricing pressure in the background.
For many buyers, that shift is practical.. A household looking for a larger home—or simply trying to buy at a monthly payment they can afford—may find that new construction offers terms that feel more manageable than older listings.. That preference can lift resale inventory over time, making year-over-year price declines more likely in some metro areas.
National gains look small because the market is splitting in two
Misryoum’s key takeaway is that the “average” can hide a deeper reality. The national year-over-year home price gain of +0.8% is modest, and recent stabilization doesn’t erase the fact that markets are diverging—some are still rising, while a meaningful share are drifting downward.
In the latest snapshot, 89 of the largest 300 markets are in the falling camp, while 211 remain in the rising camp.. Yet this balance can shift quickly.. The bigger point is the widening “bifurcation”—the gap between metros where prices are resilient and those where they’re not.. When appreciation at the national level flattens, differences in local conditions become more visible.
Misryoum highlights how this plays out when you compare where prices sit relative to recent peaks.. Hartford, CT is described as being about +22.5% above its 2022 peak, while Austin, TX sits around -27.8% below its 2022 peak.. Some of that divergence is explained by mean reversion—markets that ran hottest during the pandemic boom can cool more sharply when conditions normalize.
What buyers and sellers may feel next
While year-over-year declines remain in 89 metro areas, Misryoum expects the situation to continue stabilizing rather than deteriorating rapidly.. The expectation is tied to month-over-month seasonal patterns and a deceleration in inventory growth. both of which can reduce the pressure that pushes more metros into outright declines.
Still, the direction of travel will vary by neighborhood and buyer segment.. Markets where active inventory remains below pre-pandemic 2019 levels—some pockets of the Northeast and Midwest—tend to keep prices supported even when national growth is soft.. In contrast. places where active inventory is already above 2019 levels. such as parts of Texas. Florida. and Colorado. may experience pullbacks or flat pricing.
For households planning a move, the implication is clear: negotiating power is improving in certain cities, but it’s not uniform. In some metros, price softness may come with more choice and less urgency; in others, scarcity can keep prices buoyant even if growth is slowing.
For sellers, the practical impact is also real.. When buyer leverage rises, the market can reward accuracy—pricing that matches current financing realities—over optimism.. For buyers. it can mean more room to negotiate. but also more variation in what “good value” looks like from one metro to the next.
The market’s next phase: patience, pricing discipline, and new supply
Misryoum’s wider framing is that this isn’t simply a “prices up vs.. prices down” debate.. It’s a transition toward a more balanced—but more fragmented—housing market.. The same forces that cooled pandemic-era extremes—rate shifts. migration changes. and inventory dynamics—are now playing out in different ways across regions.
If supply continues to stabilize and inventory growth decelerates, the number of falling metros may shrink.. But the flip side is that earlier over-heating can leave lasting scars. particularly in cities where affordability and incomes never fully caught up.. That’s why some markets may keep lagging even when the national headline looks stable.
For anyone watching their local housing market. Misryoum suggests focusing less on the national number and more on the mechanics: how inventory is moving. how new construction is competing with resales. and whether price reductions are broadening or staying confined.. The national average may flatten, but the map won’t stay the same for long.
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