Home prices are falling in 36 of the 50 biggest U.S. metros. These 10 are dropping fastest

In the evolving real estate market, home prices are falling in 36 of the 50 biggest U.S. metropolitan areas. The trend is dictated by factors such as local conditions, high mortgage rates, and the balance between supply and demand. Realtor.com's report highlights that cities which saw significant home price increases during the pandemic are now seeing prices return to normal levels, benefiting buyers but posing a challenge for sellers.

Over the past month, there was a 10th consecutive month of year-over-year price declines per square foot, with the national measure decreasing by 1.8%. The median list price per square foot dropped in three out of four U.S. regions, with the greatest declines seen in the Northeast, South, and West. However, in the Midwest, median list prices remained stable.

Out of the top 50 metropolitan areas, 36 experienced a dip in median list price per square foot. Austin, Tampa, and Memphis saw the steepest declines of 8.1%, 5.6%, and 4.1% respectively, while Providence, Indianapolis, and Chicago experienced gains of 9.3%, 4.4%, and 3.6%. Analysts note that cities like San Francisco, which saw a 3.9% decline in August, still have extremely high median list prices of $908,700, but the price has decreased by 5.2% from the previous year.

Portland, with a median list price of $595,000, is the next most expensive of the ten metro areas with the biggest price drops per square foot. Realtor.com suggests that sellers in markets with cooling demand should be strategic with their pricing, rather than unrealistic.