When Will Housing Prices Drop? In Some U.S. Cities, They Already Have

If you’re hoping to buy a home, you might be wondering whether prices are finally coming down. In some parts of the U.S., the answer is yes—housing prices have started to decrease.
 

Are House Prices Going Down?

Recent data shows that home prices are dropping in many places:
 

• Home sales are slowing: In July 2025, homes were listed for sale an average of 58 days—a week longer than the previous year.
• Prices are slipping: The Federal Housing Finance Agency said prices fell by 0.2% between April and May. According to Realtor.com, prices dropped in 33 out of the 50 largest cities in July. Eight more cities saw prices rise, but not as quickly as before.
• Median price is lower: The median price for a home in summer 2025 was $410,800, less than at the start of the year.
• More homes for sale: Inventory (the number of homes on the market) improved by nearly 25% in the last year, and over 20% of listings had a price cut.

However, inventory is still lower than before the pandemic. Many homeowners don't want to sell and give up their low mortgage rates, especially with today’s rates above 6%.

But rates may drop soon—experts predict rates will slowly decrease by 2026, which could encourage more people to sell and buy homes.

Economists expect home prices to keep growing, but more slowly. Prices might not fall everywhere, but most forecasts see only small increases in the next year.
 

Where Are Prices Dropping?

If you need to buy a home soon, picking the right city could get you a better deal:
 

• Austin, Texas: Prices are down nearly 5% in the last year, with many homes sitting on the market for weeks and almost a third of listings having price cuts.
• Other cities with big drops since 2022: Miami (down almost 18%), Austin (down nearly 15%), San Antonio (down about 11%), and losses in San Francisco, Dallas, Orlando, Denver, and Raleigh.

But prices aren’t dropping everywhere. In fact, in 31 of the 50 biggest cities, prices are steady or rising. For example, Detroit’s prices haven’t changed much since 2022, and cities like Milwaukee, Providence, and Cleveland have seen prices jump over 20%.
 

Tips for Home Buyers

Waiting for more homes to be listed or for lower mortgage rates isn’t your only option. Here are some ideas:
 

• Buy now and refinance later: You can buy a home now and refinance if rates drop in the future. This helps you start building home equity sooner.
• Start small: Consider buying a condo or even a tiny house. These can be much cheaper than traditional houses and still help you build equity.
• Look into modular homes: These homes are built in pieces off-site and put together on your land—they can cost 10-20% less than standard houses.

 

Common Questions

Will 2026 be a better time to buy?

Experts expect interest rates and home price growth to slow down by 2026, which might make it a good time to buy.

Will U.S. housing prices ever go down?

Home prices generally fall when there are more houses for sale than buyers. Right now, supply is growing but hasn’t reached pre-pandemic levels.

Is it smart to buy a house now?

If you’re financially ready and it fits your life plans, it could be a good time to buy—especially since price growth has slowed and some cities are even seeing drops.

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