The Cities With The Highest Housing Price Declines
The housing market has had a tumultuous 2022 so far. Interest rates started the year at around 3.22% for a 30-year mortgage and are now at around 5.55%. That along with other factors has cooled a market that has been running wild since the pandemic started in 2020.
Prices are falling in most areas. Realtor.com recently ran an article detailing the 10 cities in America with the largest housing price declines. And they made a cutesy map to go along with it, so I found it worth highlighting.
Down Down
This is why maps are important. If you only saw these cities in a list you might not easily pick up on the fact that none are in the East, and all but two are in the West. And some might argue that Austin is in the West but I’ll leave that for others to debate.
Why are most of the biggest declines in Western cities? Those cities had already experienced the biggest booms from the pandemic. As Deseret News explains:
In 2020, 2021 and early 2022, the West became an appealing destination for Americans set free by remote work. Demand here, in fast-growing areas that were already booming, skyrocketed even more, translating to yearly double-digit price increases that have compounded to over 50% or even 60% higher in some areas.
The massive increase in work from home arrangements fueled the move to desirable western cities such as Boise, Salt Lake City, and Colorado Springs. People like the mountains, and regular readers know I’ve climbed a mountain or two in my time.
Now those western cities have sharp price declines and less demand. Perhaps it’s my time to pounce… haha.
But Still Up…
All the talk is about the declines in housing prices and sales this year, but it needs to be put in perspective. Since the pandemic housing boom things are still up, quite significantly.
So even though it might seem like prices have fallen off a cliff, the chart above is a nice way to remind you that things are still up, even from the peak of last year.
Just like the crappy 2022 stock market. As of this writing the S&P 500 is at approximately the same level it was in April 2021. I don’t know about you, but I don’t consider that a long time ago.
I’ve been busy adventuring and moving my body in nature, so that’s all I’ve got for you this week folks. I do real estate updates from time to time, particularly when they show interesting geographic patterns. Housing price declines are important to know about, especially if you’re a real estate investor or planning a move. So I hope you find this post of value and thanks for reading!
The media and realtors sure love making everyone think the sky is falling and housing is spiralling out of control downward in some massive crazy bubble. When as you point out, in fact it is just barely off the top of an unsustainable rise and housing crisis for so many.
The mainstream media have become experts at deception, it’s beyond laughable at this point. And I agree the rise since 2020 is unsustainable, we’ll see
Great and timely article as I was just discussing this topic with my Dad yesterday. Yep, definitely still up but certainly cooling somewhat (which I think is a good thing). It’d be awesome to have an update to this in the next 6-8 months. My sense is the downward trend will continue as rates rise. Thanks for sharing!
I agree, and interest rates may rise further. Something’s gotta give
and all those laptop flatlanders ended up in the woods. i did a bunch of reading about the culture class resulting from the booms in some of these western cities. the laptoppers should show up and adapt a little.
I remember reading an article about the elites and culture class who moved from NYC to the Catskills to start “farm to table” restaurants and organic this and that places. The clash with the Catskill locals was direct and harsh, and they quickly became unwelcome. As you mentioned, it seemed they made no attempt to adapt.
I find it so odd that Sacramento went up in price so much, I grew up there and it’s like the sprawl of Los Angeles with less desirable weather and public infrastructure. Denver is great, but not THAT great to justify those still sky high prices, even though it’s down a bit. I still wonder how people are affording payments on a $750k mortgage in their 30s.
I’ve traveled throughout Cali many times but have never been to Sacramento. Would love to see it as I’m always up for seeing a new place. I passed near it when I climbed Shasta but didn’t have time to stop. And yeah, a $750k mortgage in your 30’s is no joke. You better damn well have a good salary or you’re living month to month with no buffer.
I definitely saw the price declines when we were trying to sell our home in the Seattle area. We missed the peak by just a few weeks, but it made a big dent in our sales price.
Out here in AZ though, I haven’t seen much in the way of price declines yet. *shrug* Go figure. Great post Dave!
Too bad you missed the peak. A house on my street went for sale one week before interest rates made a big jump, she just missed the window. She’s now lowered the asking price by $40k and still hasn’t sold yet. But as the chart in my post shows, compared to even last year our prices are still up here.
Interesting Post Dave, yea what I’m trying to figure out is why Evansville Indiana is on the list? What goes on there to make housing prices decline? Wonder why the prices there were elevated in the first place? Not saying it’s not a great place to live however, just wondering! I certainly understand the housing price declines of the cities in the West.
No idea about what’s going on there, perhaps someone in the know could chime in. At around 100,000 people it’s not a huge city but not tiny either.
That’s a good list. The housing price in Portland didn’t go up much so it didn’t fall much. At least that what it seems like to me.
Portland is it’s own unique thing, haha. Thanks Joe!
Some of these are really surprising but other are not. I guess least surprising would be Austin which seems to be a place that has been hyped for close to a decade now.
Yeah Austin skyrocketed and became ridiculous. Nothing can go up that fast without a crash of some sort afterwards