More than half of the country's 50 most populous metros saw prices fall, with further declines likely ahead
US home prices fell by 0.1% in June, continuing a three-month streak of modest declines on a seasonally adjusted basis. A new report from Redfin highlighted that year-over-year price growth also slowed to 3.4%, the lowest rate since June 2023.
For much of the past two years, prices rose steadily due to limited housing inventory and just enough buyer competition. However, this year marks a shift. A growing supply of homes is now meeting weak demand, as elevated mortgage rates and high prices deter many buyers. According to Redfin, sellers now significantly outnumber buyers.
'Sales activity remains sluggish'
“Home prices are slipping a little more each month as sales activity remains sluggish,” said Sheharyar Bokhari, senior economist at Redfin. “June was the second month in a row where more than half of the 50 most populous US metros posted a decline in prices.”
He added, “Even with more homes for sale, high mortgage rates are keeping many buyers—and more recently sellers—on the sidelines. We expect prices to fall about 1% by the end of the year as low demand continues to weigh on the market.”
Washington, DC leads monthly declines
In June, 30 of the 50 largest metro areas saw home prices fall month over month. Washington, DC posted the largest decline at 1.8%, marking its third straight month of a drop of at least 1.5%. It was the metro’s second-largest monthly decline since the Redfin Home Price Index began in 2012, following a 1.9% drop in May.
Although DC home prices remain 2.9% higher year over year, that marks a steep drop from the 10.9% growth recorded in March—the sharpest shift in annual growth among major metros since that time.
Federal government job cuts have had a significant effect. Redfin’s local market manager, Marshall Park, said, “We’ve moved from a bidding war environment to one that demands strategic pricing, thoughtful staging, and the right updates to make a home truly appealing.”
Park continued, “Federal job cuts are certainly a contributor—some sellers are listing due to buyouts or early retirements, which is adding to inventory. But it’s not just layoffs. We’re also seeing signs of price sensitivity as higher interest rates force buyers to reevaluate what’s affordable.”
Other markets show mixed trends
After DC, Austin, TX, saw the next largest price drop at 1.5%, followed by San Diego, CA, with a 1.4% decrease. Meanwhile, home prices rose in Montgomery County, PA (0.6%), Providence, RI (0.5%), and New York (0.5%).
Year over year, New York recorded the strongest price growth at 11.7%, followed by Philadelphia (11.2%) and Detroit (9.4%). On the downside, Tampa, FL, posted the largest annual decline at 4.5%, with Austin (-3.5%) and Dallas, TX (-2%) also experiencing significant decreases.
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