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Which cities have experienced the biggest drop in home prices recently?
If you’re looking for undervalued opportunities, this list of 12 places where home values have plunged could help guide your next investment move.
Learn what caused these market crashes and whether they present opportunities for buyers and investors in 2025.
This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.
1) Orlando (-23%)
Orlando’s housing market took a major hit in 2024, with home prices dropping by 23.0%, one of the largest declines in the country this year.
Despite a population increase of around 55,000 new residents from July 2022 to July 2023, the housing supply surged, creating an imbalance between supply and demand.
The city reached a record-high inventory of nearly 9,000 homes, flooding the market with options and forcing sellers to lower prices to compete.
To address affordability concerns, Orlando allocated $2.8 million in federal funds for affordable housing initiatives.
Although it provided some relief for lower-income buyers, it wasn’t enough to stop the overall drop in the market.
Sources: Redfin, Florida Realtors, Federal Reserve Economic Data, The World Property Journal, Zillow
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2) Austin (-21%)
Austin’s housing market saw a major drop in 2024, with home prices falling by 21.4%, one of the steepest declines in the country.
A key reason for this was a surge in housing supply that far outpaced demand, leading to an oversaturated market where sellers had to lower prices to compete.
To address affordability and boost housing development, the city implemented reforms reducing minimum lot sizes for single-family homes.
While this made it easier to build more homes, it also added to the oversupply problem.
And despite Austin's reputation as a growing tech hub, its job growth slowed to just 0.4% in 2024, limiting the number of new buyers entering the market.
Sources: Bureau of Labor Statistics, Austin Chamber of Commerce, Oxford Economics, Federal Reserve Bank of Dallas, U.S. News
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3) Kansas City (-18%)
Kansas City’s housing market saw a steep decline in 2024, with home prices dropping by 18.0%.
One major factor was the sharp rise in housing inventory, which increased to 6,590 available homes, giving buyers more choices and forcing sellers to lower prices.
Houses also took longer to sell, with the average time on the market increasing to 32 days, as fewer buyers were rushing to make offers.
Mortgage rates climbed to 6.14% for a 30-year fixed-rate loan, compared to the national average of 6.09% for the same period
So even though more people were moving to the city, high mortgage rates and expensive home prices made it harder for many to afford a home, causing demand to fall.
Sources: Redfin, Federal Reserve Economic Data, Center for Real Estate, Zillow
4) Miami (-12.4%)
Miami’s housing market took a sharp hit in 2024. Despite its allure as a tropical haven, home prices couldn’t keep up with shifting demand and dropped by 12.4% year-over-year.
This decline is attributed to several factors, including an oversupply of luxury condominiums and rising Homeowners Association (HOA) fees.
The introduction of new state laws requiring condo buildings to save more money for future repairs caused HOA fees to go up. This made owning condos more expensive, so many owners decided to sell their properties.
Consequently, the number of condo listings nearly tripled within a year, contributing to the oversupply and driving prices down.
Additionally, the number of homes for sale in Miami increased by 72.2% year-over-year. This flood of available homes made it even harder for sellers to find buyers, pushing prices down further.
Sources: Miami Realtors, Redfin, Norada Real Estate Investments, The Wall Street Journal , UBS
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5) Cincinnati (-11%)
Cincinnati’s housing market struggled in 2024, with home prices dropping by 11.0%, making it one of the hardest-hit cities in the U.S. this year.
A key issue was an oversupply of homes, as the number of houses for sale jumped by 44.6%.
This flooded the market with more listings than there were buyers.
Adding to the problem, Cincinnati’s population dropped by 0.55% from 2022 to 2023, meaning fewer people were looking to buy homes.
Some areas saw local housing prices rise by 7%, but this wasn’t enough to offset the overall market decline.
Sources: Redfin, Realtor Alliance of Greater Cincinnati, Zillow, Federal Reserve Economic Data
6) Phoenix (-10%)
Phoenix’s housing market faced a significant shift in 2024, with home prices dropping by 10.0%, marking a tough year for the city.
The metro area population grew by 1.27%, reaching approximately 4,777,000 residents. But while thsi growth added some demand, it wasn’t enough to counter the market's challenges.
The market changed from a strong seller’s market to a more balanced one, giving buyers more power and less pressure to overpay for homes.
A key issue was the city’s shortage of over 65,000 homes, which made affordability and supply major problems for many residents.
This shortage of homes meant more people were competing for fewer options, making it harder and more expensive for many to buy a house.
Sources: Redfin, Home Buying Institute, Common Sense Institute Arizona, Arizona Center for Investigative Reporting
7) San Francisco (-7.5%)
San Francisco's housing market experienced a significant downturn in 2024, with home prices declining by 7.5%.
One major factor was the outmigration of tech workers, as remote work allowed many to move to more affordable areas, reducing demand for housing.
Despite this, the city had fewer homes for sale, with listings down by 10% compared to pre-pandemic levels.
At the same time, many buyers started preferring suburban homes over city living, making it even harder for the market to recover.
To encourage new construction, Mayor Breed’s Proposition C removed real estate transfer taxes for some housing projects. However, this didn’t do enough to make up for the drop in demand.
Sources: San Francisco Chronicle, Zillow, Bay Area Market Reports, Norada Real Estate Investments, Internal Revenue Service
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8) Dallas (-7%)
Dallas’s housing market faced notable challenges in 2024, with home prices dropping by 7.0%.
A contributing factor was a population decrease of nearly 5,000 residents between mid-2020 and mid-2023, leading to reduced housing demand.
At the same time, the city experienced a rise in housing inventory, with active listings increasing by 21% compared to the previous year.
This means more homes were available for buyers, which eased the intense competition seen in recent years and gave buyers more options.
Potential changes in Federal Reserve rate policies further influenced the market. Uncertainty about interest rates made some buyers hesitant, slowing down overall activity.
Sources: Statista, Texas Demographic Center, United States Census Bureau, Home Buying Institute, Census Reporter
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9) Jacksonville (-5.3%)
Jacksonville’s housing market saw a decline in 2024, with home prices dropping by 5.3%, reflecting a challenging year for the city.
The city’s population, estimated at approximately 985,843 in 2023, grew steadily, but it wasn’t enough to keep up with the changing housing dynamics.
The housing inventory slightly increased, rising from 4.4 months to 4.5 months, which gave buyers more options and put pressure on sellers to reduce prices.
Jacksonville’s focus on affordable housing played a key role in the market, with efforts to revitalize neighborhoods and address rising property taxes.
However, these measures couldn’t fully offset the cooling demand. Higher borrowing costs and affordability concerns further slowed the market, adding to the city’s housing price struggles in 2024.
Sources: Redfin, Home Buying Institute, Federal Reserve Economic Data, Norada Real Estate Investments, Florida Politics
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10) Denver (-5%)
Denver’s housing market faced challenges in 2024, with home prices dropping by 5.0%, signaling a noticeable shift for the city.
Despite Denver’s growing popularity, the metro area population is projected to increase by only 1.09% in 2024, slowing the demand for housing compared to previous years.
Interestingly, listings decreased by 5%, meaning fewer homes were put up for sale. This kept prices higher in some neighborhoods, even though overall home values dropped.
The city’s Expanding Housing Affordability policy, implemented in July 2022, required developers to include affordable housing units in new projects.
While this aimed to address affordability, it also slowed the pace of high-end developments.
Sources: Redfin, Common Sense Institute Colorado, Forbes, Denver Investment Real Estate
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11) San Antonio
San Antonio’s housing market had a tough time in 2024. Homes became too expensive for many locals, with the median home price at $302,500, while the average household earned just $55,000 a year.
On top of that, mortgage rates climbed to 6.4%, making monthly payments too high for many buyers, making it even harder for people to afford a home.
At the same time, too many homes were being built. Even though 22,000 new people moved to San Antonio between 2022 and 2023, there weren’t enough buyers to keep up with all the new construction.
Sellers found themselves with homes sitting unsold for months.
With prices so high and more homes on the market than buyers, 2024 saw home prices in San Antonio fall by 4.6% with the median home price dropping from $334,100 in early 2023 to $305,800 by March 2024.
12) Tampa (-1.4%)
Tampa’s housing market saw prices drop slightly in 2024, with a 1.4% price decline, but the impact was felt more strongly in specific areas.
One key factor was that 43% of homes had price reductions, as sellers struggled to attract buyers in a cooling market.
Simultaneously, there was a 48% increase in housing inventory compared to the previous year.
This flood of new listings gave buyers more choices, putting pressure on sellers to lower prices.
On top of this, Tampa experienced a natural population decline, with more deaths than births, which slowed overall demand for housing.
Sources: Redfin, U.S. Department of Housing and Urban Development, Tampa Realtors, U.S. News, Norada Real Estate Investments
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So, why have home prices crashed in these 12 places? It's all about supply and demand!
In 2024, several cities across the U.S. experienced significant drops in home prices, primarily due to an imbalance between housing supply and demand.
For instance, Orlando saw a 23% drop in home prices, largely because of a record-high inventory of nearly 9,000 homes, which flooded the market. Similarly, Austin faced a 21.4% decline as housing supply surged, outpacing demand and leading to an oversaturated market.
In Kansas City, home prices fell by 18% due to a sharp rise in housing inventory, while Miami experienced a 12.4% drop because of an oversupply of luxury condos and rising HOA fees. Cincinnati and Phoenix also saw declines of 11% and 10%, respectively, due to oversupply and affordability issues.
Other cities like San Francisco and Dallas faced unique challenges, such as outmigration and population decreases, contributing to price drops of 7.5% and 7%. Meanwhile, San Antonio, Jacksonville, Denver, and Tampa saw smaller declines, but the common thread was an increase in housing inventory and affordability concerns.
Overall, these market crashes highlight the critical role of supply and demand dynamics in real estate, where an oversupply of homes and affordability issues can lead to significant price drops, even in growing cities.