Let's dive into what might be the biggest topic on many minds right now: housing prices. If you're a homeowner, thinking about selling, or a hopeful buyer, listen up! The word on the street, from a top economist at the National Association of Home Builders (NAHB), is that we're likely to see home prices fall in many cities in 2026. This isn't just a feeling some people have; it's a prediction based on what builders are already doing to make their new homes more affordable.

This is a pretty big deal because, for years, it felt like home prices were only going one way: up. What the builders are telling us paints a picture of some needed adjustments. It boils down to this: if builders have been dropping their prices to sell homes, eventually, people selling their existing homes will have to do the same.

Home Prices Could Fall in 2026 as Builders Slash Prices

Why the Price Drop Prediction for 2026?

Robert Dietz, the chief economist for the NAHB, made waves at the International Builders Show (a major event for folks in the home-building industry) by sharing his outlook. He believes that in most areas, we'll see existing home prices come down. Why? To make things more affordable for buyers.

Here's the core of his argument, as I see it:

• Painful Price Discovery: Dietz put it well when he said existing homeowners are now faced with the “price discovery” that builders have been doing since 2022. Builders have had to get real about their pricing strategies to keep selling homes when affordability became a major hurdle. Individual sellers, however, have been slower to adjust their expectations.
• The Affordability Crisis in Numbers: He pointed to a concerning statistic: the typical home price is now 4.9 times higher than the typical income. This is way above the historical average of around 3 times income and even beats the ratio seen during the housing bubble peak in 2005. When homes are this expensive relative to what people earn, it's incredibly tough for them to save up for a down payment, whether it's the 3.5% needed for an FHA loan or the 10% for a conventional one.
• Builders Are Already Doing It: The data supports Dietz's point. He noted that prices for newly built homes have actually been trending down for about three years. The typical new home is now about 15% cheaper than it was in the fall of 2022. This is happening because builders are slashing prices to overcome the affordability challenges that are hurting demand.

New Homes Are Cheaper Than Used? You Heard Me Right.

This is where things get really interesting, and it's something I've been watching closely. A recent analysis from Realtor.com® revealed something almost unheard of: new homes are now more likely than existing homes to have had their prices cut.

Let's break this down:

• Q4 2025 Data: In the last three months of 2025, 19.3% of new home listings had price reductions. For existing homes, that number was just 18%.
• Inverted Trend: Even more striking, since April 2025, the median price for a new home has actually been lower than the median price for an existing home. Think about it: it's like a car dealership charging more for a used car than a brand new one of the same make and model. It just doesn't happen traditionally, and it signals a major shift.

So, why are builders willing to drop prices so much?

• Smaller Homes: While some of the relief in new construction comes from somewhat smaller homes (floor plans are about 5% smaller than in 2022), the biggest chunk is due to direct price cuts and discounts.
• Market Pressure: Builders are in the business of selling homes. When buyers can't afford them due to high prices, builders have to adjust. They've been ahead of the curve in this “price discovery” process.

What Does This Mean for Existing Home Sellers?

Dietz's prediction is that individual home sellers will eventually have to catch up. They've been reluctant to let go of the high prices they might have achieved during the pandemic's buying frenzy. But as new homes become more competitively priced, sellers of existing homes will likely face increasing pressure to lower their asking prices to attract buyers.

The historical precedent of a 3-to-1 home price-to-income ratio, which was once a reliable indicator of affordability, is now a distant memory. When that ratio balloons to 5-to-1, it makes it incredibly difficult for many households, especially younger ones, to get a foot in the door.

But Not Everyone Agrees…

Now, it's important to note that not every expert shares this exact outlook. At the same International Builders Show, Danielle Hale, the chief economist for Realtor.com®, offered a slightly different perspective.

Hale expects modest price increases for homes in 2026. She pointed out that asking prices were pretty flat in January compared to the previous year, but actual sales prices edged up a bit. This indicates that the market, especially in areas like the Northeast and Midwest, remains competitive.

Here's her take:

• Seller Confidence: Hale noted that the percentage of listings with price reductions has actually gone down recently. She interprets this as sellers being more confident in their initial pricing from the start, aiming to avoid needing reductions as they move into 2026.
• Regional Differences: She also emphasized that the housing market is not a monolith. There's a lot of variation by region. While some areas, particularly in the South and West, might see softer prices, others in the Midwest and Northeast are still quite hot with rising prices. This “regional bifurcation” is more pronounced than usual.

She highlighted that the varying inventory levels across different markets are a major driver of these regional differences.

My Two Cents (Bringing Expertise to the Table)

From my years of following real estate trends, I can tell you that both perspectives have merit. Dietz's point about builders being the first movers in price adjustments makes perfect sense. They have overhead, construction loans, and inventory to manage, so they're often the first to blink when demand cools.

However, Hale's observation about regional variations is also crucial. Housing markets are incredibly local. What's happening in Chicago is very different from what's happening in Phoenix. Factors like local job growth, migration patterns, and the sheer amount of available housing stock (inventory) play a massive role.

I lean towards Dietz's prediction for many cities, particularly those that experienced the most significant price run-ups during the pandemic and where affordability is the most strained. The data from Realtor.com® on new vs. existing home price cuts is a strong signal that a correction is underway. Existing homeowners will eventually have to confront the new reality of pricing if they want to sell in a competitive market.

However, I also agree with Hale that some markets, especially those with strong job growth and limited inventory, might continue to see price stability or even modest increases. It's unlikely to be a nationwide cliff-dive, but rather a more nuanced shift with some areas experiencing notable price softness while others remain more resilient.

The key takeaway for anyone involved in the housing market is to stay informed about local conditions. Don't base your decisions on national headlines alone. Work with local real estate professionals who understand the pulse of your specific area. If you're a seller, be realistic about pricing. If you're a buyer, you might finally see some breathing room in 2026, but it's still wise to be prepared and act strategically.

It's a question on many homeowners' minds and prospective buyers' lips: what's happening with home prices? For years, we've seen a rocket-fueled climb in housing costs across many parts of the country. But now, after that sustained surge, a pause has settled in across six major metropolitan areas. Home prices have essentially stalled nationwide, a significant shift from the dramatic gains we’ve become accustomed to.

Home Prices Stall Across 6 Major Metros After Years of Gains

This slowdown isn't exactly a shocker. Based on the data from Realtor.com, released January 23, 2026, cities like New York-Newark-Jersey City; Charlotte-Concord-Gastonia, NC-SC; Atlanta-Sandy Springs-Roswell, GA; Buffalo-Cheektowaga, NY; Indianapolis-Carmel-Greenwood, IN; and Columbus, OH, are showing prices that have held pretty steady over the past year. This indicates a market that’s recalibrating, not necessarily crashing.

The Big Picture: Why the Stall?

So, what’s behind this nationwide pause? Jake Krimmel, senior economist at Realtor.com®, points to a classic economic dance between supply and demand. “Flat price growth usually means changes in demand and supply are in a stalemate,” he explained.

It really boils down to a few key factors that have been shaping our economy for a while now:

• High Mortgage Rates: This is the elephant in the room for most buyers. When the cost of borrowing money goes up significantly, so does your monthly payment. This makes purchasing a home a lot less affordable, even if prices aren't actively falling.
• Stubborn List Prices: Even though growth has stalled, we're not seeing widespread price drops. In many of these markets, list prices remain relatively high, meaning buyers still face a significant financial hurdle.
• Economic Uncertainty: With inflation concerns and questions about future wage growth, people are understandably being more cautious with their money. Big financial decisions, like buying a home, often get put on the back burner when the economic outlook is cloudy. Consumer confidence plays a huge role here.
• Low Demand, and Sometimes Low Supply: Krimmel also highlighted that a combination of these factors is contributing to lower buyer demand. In some areas, while demand is down, supply hasn't kept up either, leading to a standoff rather than drastic price shifts.

A Closer Look at the Stalled Housing Markets

Let's dig into some of these specific cities and what experts on the ground are seeing.

1. New York-Newark-Jersey City:
   • Median List Price (December 2025): $749,939
   • Median List Price (December 2024): $750,000
     As you can see, the change here is practically negligible. Nikki Beauchamp, an associate broker with Sotheby's International Realty in New York City, attributes this stability to the market's inherent nature. New York is a high-barrier, supply-constrained market. This means there aren't a ton of homes available, and entry is tough, which naturally cushions it from wild price swings. She also noted that homes in pristine, turnkey condition still command a premium, while those needing renovations are less attractive.
2. Charlotte-Concord-Gastonia, NC-SC:
   • Median List Price (December 2025): $422,516
   • Median List Price (December 2024): $422,450
     Here again, we see a very, very minor difference. Kate Terrigno, broker at Corcoran HM Properties in Charlotte, describes this as a market that's “recalibrating and re-stabilizing rather than weakening.” Buyers have taken a breather, partly due to “inflation fatigue” and general uncertainty about what’s next economically. The good news? It feels less volatile, making it more predictable for buyers.
3. Atlanta-Sandy Springs-Roswell, GA:
   • Median List Price (December 2025): $400,000
   • Median List Price (December 2024): $399,950
     Atlanta, a market that saw rapid growth in previous years, now shows a transition to a more balanced state. Bruce Ailion, a real estate professional and attorney with Re/Max Town & Country in Atlanta, explains that household incomes haven't kept pace with the combined cost of home price appreciation and financing costs. This has effectively reduced buyer purchasing power, leading to dampened demand at higher price points.
4. Buffalo-Cheektowaga, NY:
   • Median List Price (December 2025): $249,950
   • Median List Price (December 2024): $249,950
     Buffalo is a classic example of how low inventory can keep prices from falling. Colleen Collier, an associate real estate broker at Re/Max Plus in Buffalo, notes that the area is attracting new residents, including remote workers, who appreciate its affordability and four distinct seasons. This steady influx of interest, combined with limited homes for sale, is keeping prices firm.
5. Indianapolis-Carmel-Greenwood, IN:
   • Median List Price (December 2025): $309,974
   • Median List Price (December 2024): $309,959
     Indianapolis benefits from a strong job market, thanks to investments from large corporations. Mike Feldman, a real estate agent with Compass of Indiana, suggests that while interest rates have stabilized, economic uncertainty and inflation are making people more conservative. They're holding steady, not necessarily declining.
6. Columbus, OH:
   • Median List Price (December 2025): $349,950
   • Median List Price (December 2024): $349,450
     Columbus boasts a growing economy with major employers like Honda, Chase, and Nationwide, drawing people from other states. Aasiya Raza, of The Madosky Shaw Group at Coldwell Banker Realty in Columbus, points out that strong school systems also fuel demand. While more homes are coming onto the market, steady interest rates are preventing dramatic price swings.

What Does This Mean Moving Forward?

The data paints a clear picture: the red-hot seller’s market of years past has cooled. We're in a period of adjustment. High borrowing costs mean affordability remains a key concern for buyers, while sellers are finding that the days of multiple offers significantly above asking price are, at least for now, on hold in these specific markets.

For those considering buying or selling, understanding these localized dynamics is crucial. It's not a one-size-fits-all housing market, and what's happening in one city might be quite different from another, even within these six metros. As I see it, this period of stabilization could actually be a good thing for creating a more balanced and sustainable housing market in the long run.

The housing market is definitely doing a bit of a tightrope walk right now, and the latest numbers are showing us that for home prices dropping in 9 of the top 20 metros across the country, it's no longer just a blip but a noticeable trend. This isn't the frantic seller's market we saw a couple of years ago; instead, we're seeing a more complex picture emerge, where affordability is starting to whisper sweet nothings to buyers, even as some homeowners nervously watch their equity take a breather.

Home Prices Drop in 9 of the Top 20 Metros Signaling a Significant Shift

I've been following this market for a while, and what we're seeing now is a much-needed return to normalcy after a period of truly head-spinning appreciation. It's important to understand that home prices don't always go straight up; they have their cycles, and right now, we're in a significant cooling-off phase in key areas.

The National Pulse: A Slowing Beat

Let's get down to brass tacks. The S&P CoreLogic Case-Shiller Home Price Index, which is a really solid way to track how home values are changing because it looks at the same houses over time, told us something important recently. In August, the national growth in single-family home values only rose by a modest 1.5% compared to the year before. This is down from July's 1.7% and marks the slowest pace of growth we've seen since way back in 2012, when prices were actually going down.

But here's where it gets really interesting: when you look at the major metropolitan areas, the story really unpacks. Of the 20 major metros they track, nine are now seeing their home values fall on an annual basis. These aren't just any cities; they're some of the most talked-about places in the U.S. – think Tampa, Phoenix, Miami, San Francisco, Dallas, Denver, San Diego, Seattle, and Los Angeles.

Two big names, Seattle and Los Angeles, just joined the list this month, while the other seven cities had already been on the downward trend for a bit. This tells me the slowdown we're observing isn't confined to one or two isolated spots; it's spread across significant portions of the West and South.

Why the Chill? A Look Under the Hood

So, what’s behind this cooling? Several factors are at play, and it's not just a simple case of “prices are falling.”

• Inflation vs. Home Values: Nicholas Godec, who works with the Case-Shiller data, pointed out that for the fourth month in a row, home values are actually losing ground to inflation. This means that even though the sticker price of a home might be a little higher than last year, your real wealth as a homeowner is shrinking because other costs of living are rising faster. The 1.5% national home price gain is significantly lower than the 2.9% inflation rate for the same period. That's a real wealth erosion, even if the numbers on paper look okay at first glance.
• Affordability's Comeback Tour: For those of us who have been priced out of the market or are looking to upgrade, this might be the silver lining. As home prices cool and, importantly, mortgage rates have dipped to their lowest in over a year (around 6.19% recently, according to Freddie Mac), the barrier to entry is slowly lowering. Lisa Sturtevant, Chief Economist at Bright MLS, notes that shoppers are finding more breathing room. However, she wisely adds that growing economic uncertainty is keeping some people on the fence, which is completely understandable. Nobody wants to buy a home if they're worried about their job.
• The Post-Pandemic Rebalancing: Remember the stampede to the suburbs and Sun Belt cities during the pandemic? Many of those areas saw incredibly sharp price increases. Now, those same markets are experiencing some of the largest corrections. Conversely, cities like New York and Chicago, which felt a bit stalled during that exodus, are actually seeing some of the greatest appreciation right now. It’s a natural rebalancing, where the areas that got the hottest are now cooling off the most.

Regional Divergence: A Tale of Two Americas

The national story, as always, masks some really important regional differences.

• Northeast and Midwest Resilience: Markets in the Northeast and Midwest are generally holding up better. Anthony Smith from Realtor.com® attributes this to tighter resale supply and more steadier demand. These areas didn't see the same explosive pandemic growth, so they don't have as far to fall, and local economies tend to be more stable.
• Sun Belt and West Softening: On the flip side, places in the Sun Belt and the West are showing more clear signs of softening. Inventory is coming back more quickly, homes are staying on the market longer, and we're seeing more price cuts and delistings. Tampa, for instance, has seen prices drop year-over-year for 10 straight months, with August’s decline at 3.3%.

Beyond Annual: Monthly Trends Hint at Broader Weakness

While the annual numbers are important for long-term trends, the monthly data can sometimes give us a more immediate snapshot of what's happening. And the August monthly figures were pretty telling: 19 out of the top 20 metros saw home prices fall on a monthly basis.

The only exception? Chicago, which actually saw a small gain of 0.26% from July to August. On the other end of the spectrum, Portland, Oregon, and Los Angeles experienced the biggest monthly drops, both falling by more than 1%.

This widespread monthly decline suggests that the weakness isn't just a seasonal lull in some of these hotter markets; it's a more pervasive cooling that could potentially spread even further.

Godec’s statement again hits the nail on the head: “With price growth running at half the rate of inflation and several major markets in decline, the rapid appreciation of recent years has clearly ended.”

What Does This Mean for You?

This cooling market isn't necessarily good or bad; it's just different.

• For Homeowners: If you're looking to sell, you might not get the sky-high offers you would have a year or two ago. It’s crucial to price your home realistically and be prepared for a bit more negotiation. Your real equity might be decreasing due to inflation, so understanding your net worth requires looking beyond just the sale price.
• For Buyers: This is a moment of opportunity. With cooling prices and lower mortgage rates, affordability is improving. However, that economic uncertainty means it's still wise to be cautious, have a solid financial plan, and not stretch yourself too thin.
• Looking Ahead: The housing market appears to be finding a “new equilibrium” after the pandemic's boom. This adjustment, while potentially painful for some homeowners in the short term, could lead to a more sustainable market in the long run, where prices are better aligned with incomes and inflation.

The data from the Case-Shiller Index, though it has a few months' delay, is considered a gold standard because it tracks the same properties over time. This August data reflects purchase decisions made in late spring and early summer, so we might see these trends continue to play out.

Ultimately, the idea that home prices will always skyrocket is being challenged. We're entering a phase where a sound financial footing, realistic expectations, and understanding local market dynamics will be more important than ever.