As elevated housing costs continue to chip away at homebuyer demand nationwide, a few oversupplied metros are at risk of major price reductions in the year ahead, Insider reports. Formerly red-hot housing markets such as Seattle, Phoenix, San Francisco, and Austin, Texas, have seen substantial increases in inventory, and as a result, each metro is expected to see a double-digit price correction by late 2024.
Housing affordability remains at historic lows due to higher interest rates, but nationwide, experts are anticipating just a 6.1% decline in home prices for 2023.
By late 2024, home prices will decline by 19% in Austin, 12% in Seattle, 16% in Phoenix and 15% in San Francisco compared to late-2022 levels, the bank said in a note on Thursday.
While the housing market overall remains tight, those four cities have seen big increases in inventory, and supply is overwhelming demand, analysts said.
Advertisement
Related Stories
Housing Markets
14 US Housing Markets Where Inventory Is Returning to Pre-Pandemic Levels
Many of these markets experienced strong population growth during the onset of the COVID-19 pandemic
Insurance
As Insurance Companies Pull Out of Climate-Threatened Areas, Homeowners Reconsider Where They Live
The risk for homeowners is particularly pressing for those living in California, Florida, and Louisiana
Financing
10 States Where Shopping Around for a Mortgage Really Pays Off
In California, homebuyers could see savings of more than $130,000 over the lifetime of their loans