Let's talk about the U.S. housing market and find out places where home prices are actually falling. Based on recent data from Cotality (formerly CoreLogic), the top 10 coolest housing markets of 2025 with declining prices include several spots in Florida and Texas, along with a few others scattered across the country, offering a potential breather for homebuyers feeling squeezed out everywhere else.

Top 10 Housing Markets With Falling Home Prices in 2025

Before we dive into where prices are dropping, it’s important to understand the bigger picture. The national housing market isn't exactly collapsing, but the intense heat we felt over the last few years is definitely cooling off. According to Cotality's US home price insights for June 2025, drawing on April 2025 data, the national year-over-year price growth slowed way down to 2.0%. That's a big difference from the much higher growth rates we were seeing not that long ago.

Think about it: just a couple of months before that, prices were still growing closer to 3%. Dropping to 2% is the slowest annual growth rate since the spring of 2012. That’s over a decade! It tells us that while prices aren't plummeting everywhere, the momentum has definitely stalled significantly on a national level.

What's Behind the Slowdown?

From my perspective, this cooling isn't a huge shock. Markets can't sustain explosive growth forever, especially when things get really expensive for everyday people. Dr. Selma Hepp, the Chief Economist at Cotality, points to a few key things weighing on the market. She mentions widespread concerns about personal finances, job prospects, and even the potential impacts of tariffs. When people feel uncertain about their own money situation and the economy, buying a house – the biggest purchase most people ever make – becomes a much scarier idea.

On the flip side, there's a bit of good news for buyers: there's more inventory. Dr. Hepp notes that “improved for-sale supply is providing buyers with more options and helping keep softer price pressures.” More houses on the market means less competition, which takes some of the pressure off prices. It's simple supply and demand – when there's more stuff available and fewer people aggressively bidding for it, prices tend to stabilize or even drop.

Despite the slowdown, Cotality is actually forecasting a pickup in the rate of national price growth over the next year, projecting a 4.3% increase from April 2025 to April 2026. This might seem contradictory to the idea of declining markets, but here's where the nuance comes in: a national average can be pulled up by strong growth in some areas, even while other specific markets are seeing prices fall. It's a big country, and real estate is always local.

Where Home Prices Are Actually Declining

While the national number is still positive (though barely), the real story for someone looking for a potential deal or watching their local market cool down is found in the places where prices are negative. Dr. Hepp correctly points out that the number of markets seeing annual declines hasn't exploded – it was 14 out of the 100 largest markets in April 2025, only slightly up from 12 the month before. But for the people living or hoping to buy in those 14 markets, that decline is very real and significant.

So, where exactly are these pockets of cooling or even outright price drops happening? The data from Cotality gives us a clear list of the Top 10 Coolest Housing Markets of Spring 2025. These are the places where, according to their analysis, home prices have fallen the most year-over-year as of April 2025.

Here’s the list, ranked by the percentage of price decline:

• Cape Coral, Florida: -6.5%
• Punta Gorda, Florida: -6.2%
• Logan, Utah: -5.4%
• McAllen, Texas: -5.1%
• Victoria, Texas: -4.5%
• North Port, Florida: -4.3%
• Naples, Florida: -3.7%
• Waco, Texas: -3.1%
• Lake Charles, Louisiana: -2.7%
• Eagle Pass, Texas: -2.7%

Looking at this list, a few things immediately jump out at me.

Florida's “Course Correction” is Front and Center

Wow, Florida dominates this list! Four out of the top ten are in the Sunshine State, including the top two spots with Cape Coral leading the pack with a significant 6.5% annual decline. This isn't a surprise if you've been following the news. Florida saw some absolutely insane price growth over the past few years, fueled by migration and low interest rates. It felt, at times, unsustainable.

Cotality's data explicitly states that Florida “continues to course correct after years of explosive growth.” The state overall saw negative price appreciation at -0.8% in April. This is a major shift. Florida even dropped out of the top 20 most expensive markets nationally, with its median sales price dipping just below the national median ($395,000 nationally vs. $390,000 in Florida).

What's particularly telling is that Florida is home to all five of the most at-risk markets among the 100 largest areas they track. These include Cape Coral, Lakeland, North Port, St. Petersburg, and West Palm Beach. The price trend graph for these high-risk markets is fascinating. You can see where prices peaked for places like North Port and St. Petersburg in mid-to-late 2023 and have been trending downwards since then. Cape Coral's price trend shows a peak around the same time, followed by a steeper decline, bringing it back to levels last seen in the spring of 2022.

Why Florida? Based on my experience, markets that experience such rapid, almost vertical price increases are often the most vulnerable to corrections when conditions change. As interest rates rose and affordability became a major barrier, places that had become extremely expensive, like many Florida markets, were bound to see demand pull back sharply. It's the market's way of trying to find a new equilibrium after getting ahead of itself. While the gorgeous beaches and lack of state income tax are permanent draws, the price tags simply outpaced what many potential buyers could afford, or were willing to pay.

Texas is Also Cooling Down

Texas has three markets on the top 10 list: McAllen, Victoria, Waco, and Eagle Pass. The state of Texas overall also reported negative price growth at -0.7% year-over-year in April. Like Florida, many areas in Texas experienced very strong population growth and housing demand in recent years, partly due to its job market and relative affordability compared to coastal states.

Seeing multiple Texas cities on this list suggests that the cooling trend isn't isolated to just one corner of the state. Perhaps the rapid pace of construction in some areas has finally started to catch up with demand, or maybe the same affordability challenges hitting Florida are also impacting parts of Texas. The energy sector can also influence local economies in Texas, and shifts there can impact housing markets, though the Cotality data doesn't specify the causes for these particular cities. What I see is that markets that grew very quickly during the boom are now experiencing some of the most significant pullbacks.

Other Markets on the List

The list isn't just Florida and Texas. Logan, Utah, shows a significant -5.4% decline, making it the third coolest market. Utah also saw a huge run-up in prices during the pandemic boom. Lake Charles, Louisiana, rounds out the list with a -2.7% decline. These outliers remind us that local factors are always at play. Perhaps Logan is seeing a correction after its recent rapid growth, or maybe specific economic conditions are impacting Lake Charles.

Comparing Cool to Hot

It’s worth noting, for context, that while these markets are seeing declines, other parts of the country are still experiencing robust growth. The Cotality report lists the “Top 10 hottest housing markets,” which are seeing double-digit increases. These are places like Kokomo, IN (+13.4%), Decatur, IL (+12.5%), Syracuse, NY (+11.1%), and various markets in the Midwest and Northeast, often described as more affordable areas surrounding larger, expensive metros. This highlights the divergence in the market right now – some areas are still catching up or benefiting from relative affordability, while others that became very expensive are correcting.

What Does This Mean for Buyers and Sellers?

If you're a buyer looking in one of these ten “coolest” markets, this data could be encouraging. Falling prices mean less competition and potentially more negotiating power than buyers have had in years. However, declining markets can also feel risky. Will prices keep falling? Am I buying at the right time? These are tough questions, and nobody has a crystal ball. My advice would be to look closely at the local reasons for the decline and your own long-term plans. Buying a home should be a decision based on needing a place to live and your financial stability, not just trying to time the market perfectly.

For sellers in these areas, it means adjusting expectations. The days of listing your house on Friday and getting multiple offers above asking price by Monday might be over, at least for now. You might need to price more competitively and be prepared for your home to sit on the market longer.

Dr. Hepp offers a note of potential optimism for the broader market going forward. She suggests that “more visibility around tariffs, diminishing concerns about an economic recession, and more homes for sale” could lead to “improved optimism and more activity.” While that might lead to national prices growing faster again, it could also mean more stability, which is generally a good thing for everyone involved.

My Takeaway

As someone who watches the housing market closely, I find this data from Cotality fascinating. It confirms my suspicion that the rapid run-up in prices couldn't last forever, especially in certain hotspots. Seeing Florida and Texas markets so heavily represented on the declining list isn't a total shock; these were areas that saw massive inbound migration and price surges. This correction, while potentially painful for recent buyers in those areas, could ultimately be healthy for the market by improving affordability over time.

It's a good reminder that the national housing market isn't a single entity. It's a patchwork of thousands of local markets, each with its own dynamics. While the national average is slowing down, it's the specific performance of markets like Cape Coral, Logan, or McAllen that truly tells the story for people on the ground there. For those looking for a place where the intense heat has dissipated, these ten markets offer some of the clearest signs of a price cool down in 2025.