10 housing markets that will plummet in value before the end of 2024
/
By Brooke Barley | Published on September 14, 2024
Housing markets in the United States are up right now, but some experts say they’re about to lose a lot of value. This could be helpful to know if you’re planning a big move or trying to find a more affordable cost of living.
Here’s a look at 10 places where experts say are about to experience a substantial drop in housing prices.
San Francisco
A city that has long been one of the most expensive places to live in the country is about to have a drop, according to Ben Johnson, a real estate agent and CEO of Big Ben.
“The high cost of living, with outmigration and a trend where most tech companies are allowing some workers to work remotely, has seen San Francisco’s real estate market begin to fall,” he said. “Home values in the city could drop by an estimated 5%-10% by the close of the year.”
The current average home price is $1,299,639, a 0.3% drop from last year, according to Zillow.
New York
“Like San Francisco, New York City also has seen a drop in home values due to the flexible work lifestyle imposed by the pandemic and the associated high cost of living,” Johnson said. “The rental market also gets softer, following [weaker] demand for residential property.”
The average home price in New York right now is $742,930. Johnson said that could drop 5%-8% by the end of the year.
Honolulu
Honolulu’s average home price sits at $794,253, but Johnson said that could dip 4%-6% by the end of the year.
“Honolulu’s housing market is expected to simmer down with the tourism industry — an important pillar in the local economy — remaining out of gear.”
Miami
Miami’s average home price is $579,125, up 8.7% since last year. However, Johnson said environmental factors could cause prices to drop 3%-5% by the end of this year.
“Miami’s housing market is threatened by overvaluation and the steadily rising sea levels, something many property investors view as a reason for avoiding Miami’s housing market. Further increased insurance lodging and proceedings fees because of climate change is making homes unaffordable.”
Las Vegas
“Considering how Las Vegas relies heavily on tourism and entertainment, both hit hard by the pandemic, the chances are high that home value in that area will experience a drop,” Johnson said.
Right now, the average home price sits at $422,880. Johnson said that’s expected to drop by 4%-7% by the end of the year.
Chicago
Johnson blames high property taxes, crime rates and lack of population growth for Chicago’s falling home prices. “Chicago’s housing market may see a decline as population growth stagnates and the city faces fiscal challenges.”
The average cost of a home in Chicago is $298,397. By the end of 2024, Johnson said that could fall 2%-4%.
Seattle
“Both high living costs and the shift to remote work in the tech industry are cooling Seattle’s market,” Johnson said. “Home values could drop by 3%-5% as more people choose not to live in the city.”
For reference, Seattle’s average home price right now is $884,828.
Austin, Texas
“A recent uptick in inventory and new construction projects has evened out the market between buyers and sellers and cooled off housing prices,” said Eric Preston, the CEO and founder of Agent Launch. “This trend should continue for the remainder of the year, especially with mortgage rates increasing. Home builders in Austin predict a greater number of home sales resulting from the state of the housing market.”
Preston said the median listing home price in Austin was $650,000 in May 2024, and the recent median sale price was $567,000, but that number could dip closer to $550,000 or lower by the end of the year.
St. Louis
Preston said St. Louis home prices have dropped 2.2% since last year. The city currently has a median home price of $221,000, which Preston predicts will drop to $200,000 by the end of the year.
“There are typically multiple factors as to why a market cools, but St. Louis has been experiencing an affordability crisis due to rising taxes in some municipalities.”
Washington, DC
Washington’s housing market is predicted to decrease by 10.2% in 2024, according to Preston. “A lack of buyers due to mortgage rates and economic issues are the main culprits.”
He said the median home price is $602,000 and could drop another 3% to 5% by the end of the year.