T
he US housing market is constantly evolving, with property prices generally increasing over time. However, some markets are experiencing a decline, particularly in Texas. In certain areas, buyer demand, supply, and economic factors could lead to plummeting housing values within the next year.
For buyers, lower prices mean better deals and potentially more negotiating power. Sellers may want to list their homes before they lose value or wait for the market to recover. Here are six markets that experts predict will see a decline in value by 2025:
Dallas, Texas: With a median home price of $390,000 and a -2.3% year-over-year change, Dallas is already experiencing a downward trend. Real estate broker Levi Rodgers attributes this to affordability concerns, high rates, and fewer buyers.
San Antonio, Texas: San Antonio's median home price has dropped 2.7% in the past year, with an average time on the market of 46 days. Rodgers expects the market to cool off further due to supply outpacing demand and new construction.
Austin, Texas: While Austin's median home price hasn't declined significantly (-0.45%), homes stay on the market for over two months. Rodgers predicts prices will continue to decline as more developments emerge and interest rates remain high.
Phoenix, Arizona: Despite a 2.4% year-over-year increase in median home price, some experts believe the market could shift due to decreased demand and increased supply. Real estate investor Sergio Aguinaga notes that Phoenix's housing boom during the pandemic may be followed by a decline.
Boise, Idaho: Boise has seen a 3.2% year-over-year increase in median home price, but Aguinaga predicts a slowdown due to high interest rates and decreased demand. If rates remain high, fewer people will buy homes, leading to further declines in prices.
Other markets that may see a decline include Florida, California, and Washington, according to experts Michael Gevurtz and Jesse Schulman of Bluebird Lending. Signs of a potentially plummeting market include recent trends, buyer demand, supply, average time on the market, and mortgage interest rates.
