Why Now Could Be the Perfect Time to Buy: Real Estate Prices Are Falling in Major Markets

If you’ve been on the fence about buying a home, the latest real estate data might just convince you that now is the time to act. Across the country, home prices in many major markets are trending downward, presenting savvy buyers with an opportunity to secure properties at more affordable prices. Here’s what you need to know:

Price Drops Across Major U.S. Markets

According to the Realtor.com® December Housing Market Report, median list prices have decreased year over year in over half of the 50 largest U.S. metros. Nationwide, the median list price dropped by 1.8%, settling at $402,502 in December 2024. Some cities, like San Francisco, have seen significant declines—a whopping 10.87% decrease compared to the previous year.

Here are the top 10 cities with the largest price drops:

What’s Driving the Market Shift?

1. Increased Inventory

In many markets, inventory levels are approaching pre-pandemic norms. Nationwide, the number of active listings surged by 22% year over year in December 2024. Notably, regions like the South and the West saw significant increases in new listings—4.8% and 2%, respectively.

2. Mortgage Rates and Buyer Power

Mortgage rates are at a six-month high, currently averaging 6.93% for a 30-year fixed-rate loan. However, the Realtor.com® 2025 Housing Forecast projects rates will average 6.3% over the course of 2025. While rates remain elevated, reductions in list prices, price drops, and increased inventory offer buyers an edge they didn’t have during the frenzied market of 2021 and 2022.

3. Regional Trends

• San Francisco: A tech hub struggling with socioeconomic challenges has seen median list prices drop to $889,499, a 10.87% decrease year over year.

• Florida Markets: Post-pandemic hotspots like Miami and Jacksonville are cooling significantly, with price drops of 9.9% and 5.69%, respectively.

• Western Markets: Once-booming areas like Austin, Denver, and Phoenix are seeing prices return to more sustainable levels, reflecting a healthier balance of supply and demand.

4. Colorado Springs: Consistent Equity Growth and Affordability

Colorado Springs continues to stand out as a strong real estate market with consistent equity gains throughout 2024. Its proximity to Denver and affordability make it a popular choice for buyers willing to commute. While Denver saw a 5.35% decrease in median list price, Colorado Springs has remained a stable and attractive option for families and professionals alike. With a median home price lower than Denver and a high quality of life, Colorado Springs offers exceptional value.

What Does This Mean for Buyers?

With prices falling and inventory increasing, buyers have more options and greater negotiating power than in previous years. Here are a few strategies to make the most of these conditions:

• Act Quickly: Lower prices and increased inventory won’t last forever. When mortgage rates stabilize, competition is likely to surge again.

• Consider Emerging Markets: Cities experiencing price drops, like Denver and Phoenix, could offer excellent investment opportunities. For those looking for long-term value, Colorado Springs provides an affordable and stable alternative.

• Work With a Pro: A knowledgeable real estate agent can help you identify the best deals and navigate a shifting market. Even if you are not looking in the Colorado Springs market, I can help assist you in finding a highly skilled agent anywhere in the US, just reach out. I am happy to help.

Conclusion

While higher mortgage rates may give some buyers pause, the current drop in home prices presents a rare opportunity to purchase property at more reasonable prices. Don’t wait too long to make your move—as inventory levels normalize and market conditions stabilize, this buyer’s market could quickly shift.

For more insights on navigating today’s real estate market, read the original article here.

Contact Nicole Strom:

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