Home Prices Are Plummeting in These 49 Regional Markets

Throughout the past two years, an ever-rising share of homebuyers has been pushed out of the for-sale market by consecutive mortgage rate hikes and a 42.3% jump in U.S. home prices, and according to Fortune, that ‘pressurized affordability’ is now causing prices to fall in some of the nation’s largest markets. As a market correction materializes nationwide, Moody's Analytics chief economist Mark Zandi anticipates a 10% peak-to-trough home price decline next year, but not all regional markets will be impacted equally.

Morristown, TN is expected to see home prices fall -24.1%, the largest drop of all markets tracked by Moody’s Analytics. Following closely behind are overheated homebuying destinations like Muskegon, MI and Pocatello, ID, which could see home price declines of -23.3% and -21.9%, respectively.

"No change in our outlook for [national] house prices or the mortgage rate. I am feeling more confident that the economy will be able to avoid a full-blown recession next year, which is consistent with the 10% peak-to-trough decline in national house prices," Zandi told Fortune on Friday. Through spring 2023, he expects mortgage rates to hover around 6.5%.

While Zandi expects around a 10% peak-to-trough home price decline nationally, he expects it to vary regionally. In markets like Morristown, Tenn. and Muskegon, Mich., Moody's Analytics predicts home prices to fall 24.1% and 23.3%, respectively. The firm expects markets like New York and Chicago to fall by 6.3% and 4.2% from peak-to-trough.

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