As housing markets across the country finally begin to cool, the winds of change are especially chilly in 10 places.
Recently, Redfin analyzed data in the 100 most populous U.S. metropolitan areas from February to May of this year and identified the markets that are cooling fastest based on several criteria, including:
- Year-over-year growth in prices
- Price drops
- Pending sales
- Sale-to-list ratio
- Speed of home sales
Redfin says a combination of higher mortgage rates and plummeting stock market returns have made home shopping less attractive than before, especially in key markets in the American West. Following are the housing markets that have cooled fastest so far this year.
10. San Francisco
In a press release announcing the analysis results, San Francisco Redfin agent Joanna Rose says her market has “changed drastically” over the past month:
“In the early spring, every home was selling over its asking price with multiple bids. Then the number of people attending open houses dropped from 20 to two, and now some homes are sitting on the market for over a month and selling for under asking price. Supply is starting to pile up.”
9. Tacoma, Washington
As we have reported, nearly half of sellers in this market recently have lowered their asking price. That type of softening has made Tacoma one of the “5 Housing Markets at ‘Very High’ Risk of Falling.”
8. San Diego
In June, we reported that San Diego was among the “5 Markets With the Biggest Decline in Home Sales.” Like many cities in California — and other parts of the nation — San Diego has seen the winds shift, and the market suddenly is becoming friendlier to buyers.
Denver has been among the most popular cities to move to in recent years, and that caused local housing prices to surge. But prices can only climb so high before few people can afford to pay them. That might be happening in the Mile High City today.
6. Boise, Idaho
Idaho was the most popular state for Americans who were relocating in 2021, and many of them headed straight for Boise. All those new residents pushed home prices so high that the market recently finished atop the list of the “15 Housing Markets Overvalued by More Than 50%.”
5. Stockton, California
Last year, Stockton was No. 2 on the list of cities with the fewest homes selling below asking price. But as so often happens with markets, last year’s hottest places are this year’s dying embers.
Seattle long has been a mecca for people seeking economic opportunity and natural beauty, and the city’s high home prices have reflected that attractiveness. But the most recent surge in housing activity is beginning to subside in the Emerald City.
3. Oakland, California
Oakland has enjoyed the Bay Area’s strong employment growth in recent years, and the city ranks among the most LGBTQ-friendly metros in the country. But for now, Oakland’s housing market seems poised to take a breather.
2. Sacramento, California
Sacramento recently topped the list of “15 U.S. Cities Where Rents Have Risen the Most.” But perhaps both renters and home shoppers soon will catch a break, as the Sacramento housing market is cooling fast.
1. San Jose, California
The sixth and final California city on this list is an expensive place to live. Not only is it No. 1 on the list of “15 Cities Where Homebuyers Make the Biggest Down Payments,” but it also has more luxury home sales than any other U.S. metro.
However, according to Redfin, the housing market finally is cooling down a bit in the heart of Silicon Valley — at least for now.
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