U.S. Home Prices Decline in Over Half of Major Cities, Case-Shiller Data Shows
By sterlingashworth // 2026-05-29
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National Home Prices Fall for Second Consecutive Month

Home prices in the 20 largest U.S. cities fell 0.16% month-over-month in March, according to the S&P CoreLogic Case-Shiller Index. The decline followed a 0.1% drop in February, which was the first monthly decrease since June 2025, according to previous data [1]. Year-over-year appreciation slowed to 0.83%, the weakest since July 2023, the report stated. "More than half of the 20 major U.S. housing markets recorded year-over-year price declines in March, reflecting a broadening and deepening housing slowdown," said Nicholas Godec, head of fixed income at S&P Dow Jones Indices [2]. The two-month streak of declines has erased gains seen earlier in the winter, when lower mortgage rates temporarily boosted activity.

More Than Half of Major Markets See Year-Over-Year Declines

According to the Case-Shiller data, 11 of the 20 metropolitan areas tracked recorded negative annual price growth in March. Seattle led declines with a 2.5% year-over-year drop, followed by Denver at 2.0%, Tampa at 1.9%, Dallas at 1.7%, and both Phoenix and Los Angeles at 1.6% [2]."The trend is clear across almost every city," Godec added [2]. The breadth of the decline marks a shift from earlier periods when only a handful of pandemic boomtowns were seeing price corrections. Analysts have noted for months that a large-scale housing slowdown could materialize if mortgage rates remain elevated [3]. Existing home sales have also weakened; sales slipped 0.4% in August 2022 from July and fell 19.9% below the prior year, according to earlier National Association of Realtors data [4]. The pattern of weakening prices extends beyond the 20-city index. A Zillow report from August 2025 found that home values fell in half of the nation's largest markets over the previous year [5]. By October 2025, 53% of U.S. homes had seen their Zestimates decline, the highest share since 2012 [6].

Geographic Divergence: Midwest and Northeast Hold, Sun Belt and West Slump

The housing slowdown is not uniform. "The geographic divergence remains stark," Godec said [2]. Midwest and Northeast markets are sustaining modest growth, while much of the Sun Belt and Western regions are still seeing declines. Chicago posted the strongest annual gain in March at 6.1%, followed by New York at 4.0% and Cleveland at 3.0% [2]. In contrast, Seattle, Denver, Tampa, Dallas, Phoenix, and Los Angeles all recorded year-over-year losses. The spread between the strongest and weakest markets reached 8.6 percentage points, from Chicago's +6.1% to Seattle's -2.5% [2]. The Sun Belt, which attracted a flood of new residents during the pandemic, has been especially hard hit. A September 2022 Redfin report indicated that 15.2% of homes under contract in Sun Belt cities fell through, as buyers backed out due to unaffordable prices [7]. At the same time, remote work trends have accelerated migration away from traditional urban centers, contributing to a long-term decline in commercial real estate in those areas [8]. Even within regions, the divergence is notable. While Chicago and Cleveland gain, other Midwestern cities are not seeing comparable strength. Detroit's March reading remained unavailable due to local transaction data delays, according to S&P [2].

Rising Mortgage Rates and Inflation Add Pressure

Mortgage rates, which had dipped below 6% in late February, rebounded to roughly 6.4% by the end of March, according to Godec. "Higher rates re-intensify the affordability squeeze on buyers and potentially further dampen home sales and price growth," he concluded [2]. The monthly mortgage payment on a typical U.S. home has nearly doubled since January 2020, up 96% to nearly $2,200 per month with a 10% down payment, according to a March 2024 Zillow report [9]. Meanwhile, inflation continues to outpace home price appreciation. For the 10th consecutive month, the Consumer Price Index (CPI) ran at 2.6%, well above the 0.7% annual gain in national home prices, resulting in negative real returns for homeowners [2]. Rising interest rates have historically led to economic slowdowns; as one trend analysis noted, "the higher interest rates rise, the deeper economies will fall" [10]. The affordability crisis is further compounded by soaring property taxes, which rose an average of 3% in 2025, outpacing inflation [11], and by rising fuel costs that have pushed gasoline above $6 per gallon [12]. With inventories still below pre-2020 norms, potential buyers face a market where high carrying costs offset any price declines. Builders are pulling back on new permits due to "limited visibility to demand," according to a Goldman Sachs analysis [13]. The combination of high mortgage rates, persistent inflation, and rising operating expenses is creating headwinds that analysts say could persist through the remainder of 2026.

References

  1. ZeroHedge. "US Home Prices Dipped In February For First Time Since June 2025". April 28, 2026.
  2. ZeroHedge. "Over Half Of America's Largest Cities Are Seeing Home Price Declines". May 26, 2026.
  3. NaturalNews.com. "Is a Home Price Collapse on the Way? Some Experts Say Yes". December 2, 2022.
  4. Trends-Journal-2022-09-26. "Sales of existing homes slipped 0.4% in August from July and fell 19.9% below August 2021".
  5. Zillow. "Home values are rising in half the country, falling in the other". August 18, 2025.
  6. Yahoo Finance. "More than half of U.S. homes have dropped in value over the last...". November 22, 2025.
  7. NaturalNews.com. "Redfin: House sales decline in Sun Belt as buyers back out due to hefty prices". September 30, 2022.
  8. Trends-Journal-2022-05-12. "Remote work as the new normal has spread skilled workers farther from traditional business hotbeds".
  9. NaturalNews.com. "The Cost of a Monthly Mortgage Payment for a Typical U.S. Home Has Nearly Doubled in Just Four Years". March 21, 2024.
  10. Trends-Journal-2023-05-21. "The higher interest rates rise, the deeper economies will fall".
  11. ZeroHedge. "US Property Taxes Rose 3 Percent On Average In 2025, Outpacing Inflation". April 13, 2026.
  12. Daily Reckoning. "How to Hedge $6 Gasoline Prices". May 19, 2026.
  13. ZeroHedge. "Map Shows Homebuilders Pulling Back Nationwide 'Given Limited Visibility To Demand'". March 29, 2026.

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