5 US Cities Where Home Values Are Up — And 5 Where They’re Down

The real estate market is coming out of its most sluggish period of the year, an annual slowdown that starts to open up slowly in late winter and explodes with activity in the Spring, when buyers come out in droves to shop a new crop of listings.

Come March, well-priced and marketed homes are expected to sell in roughly two weeks. The pace is expected to be even quicker in some local markets, including Hartford, Connecticut, where homes could sell in about seven days.

If you’re shopping for a home now, you’re likely to see price cuts on listings that have lingered from last year and a more relaxed shopping experience. History tells us those conditions might only last a few more months, though. New listings should begin surging in March and peak in May. With the surge, comes new and returning buyers. Given the historically low supply of for-sale homes — and the high demand for homes in some major markets — we can expect the pace to pick up over the next few months.

Some good news: Housing inventory continues to grow, so buyers should expect less competition for homes than in recent years. Ten of the nation’s 50 major metros have more homes on the market than have been for sale at this time of year before the pandemic. Most of those metros are in Florida, Texas and the South, where builders have been better able to keep up with demand and fewer existing owners are locked in to low mortgage rates. But Denver is also seeing an uptick in listings. 

For those of you who will be home shopping soon, now’s a good time to check your finances so that you’re confident in your budget and can position yourself to get the best possible interest rate on a mortgage.

The national picture: slower price appreciation and volatile mortgage rates predicted

The typical U.S. home value now sits at about $358,000 — 2.6% higher than it was at this time last year. The typical monthly mortgage for that home, assuming 20% down, was $1,844 in December 2024.

The slower rate of home appreciation nationally, especially compared to the past few years, could help sellers struggling with pricing. Zillow data shows that 17% of sellers cut their prices in December, a drop of nearly 5 percentage points from the previous month. The share of homes selling above list price shrunk only slightly: 27% sold above the listing price in November. That’s 1% less than a month earlier.

Mortgage rates — which affect what buyers can afford — remain volatile. After a brief dip in the Fall, rates jumped up to 6.9% for prime borrowers in December. That volatility affects home-buying budgets, making it especially important for buyers to stay on top of rates so they can move quickly to make an offer when the time is right.

Zillow economists predict home values will grow by 2.6% nationally in 2025, a soft pace that should help buyers who are saving for down payments. But some markets are likely to see higher growth than that, while others will lose value or grow at a much slower pace.

Here’s a look at some markets where values are up, and some where values are down. What this means for you depends on where you own or are looking to buy, and what you think the market in your area will do in the future.

Metros where home prices have changed the most

Real estate markets can favor either sellers or buyers, or fall somewhere in the middle. Zillow's market heat index shows the nation is currently in neutral territory that puts buyers and sellers on equal footing.

Locally, sellers have the advantage in San Jose, San Francisco, Hartford, Buffalo and Boston, while buyers have the strongest hand in Miami, New Orleans, Jacksonville, Indianapolis and Pittsburgh.

Zillow research shows that home values are up from year-ago in 44 of the 50 largest metro areas, with gains as high as 7.9% in San Jose. 

5 metros where homes values have increased the most month-over-month

5 metros where homes values have increased the most month-over-month

10 metros where home values have increased the most year-over-year

10 metros with the largest decrease/smallest increase in home values year-over year

“Why are home prices going up/down in my neighborhood?”

Local variations in home appreciation are due to a number of things that affect supply and buyer demand. They include:

1) Economic conditions and job opportunities. Metros with strong economic growth and a thriving job market tend to attract more people, leading to increased demand for housing and higher home values. 

2) Infrastructure development and amenities. People are willing to pay a premium to live in metros with well-developed infrastructure, such as efficient transportation systems, quality schools, healthcare facilities, and recreational areas.

3)  Demographic trends. Things like population growth, aging populations, and migration patterns can influence housing demand and, subsequently, home prices. Metros with significant population growth or younger demographics may experience higher rates of home value appreciation.

How can I prepare financially?

The first thing to do is determine your budget and make sure your credit score is in good shape. Paying bills on time every month, avoiding major purchases or opening new accounts, keeping your borrowing to less than 30% of your available credit, and making sure your credit report is free of errors can go a long way to boosting your score. 

Zillow Home Loans’ BuyAbility℠ tool can help you see which homes you can afford based on your financial circumstances, including your credit score, and the latest mortgage interest rates.

Talk to your agent or lender about what local trends may mean for you

There is no one right time to buy for everyone.

Even sophisticated real estate investors find it difficult to time the market for the best deal, so experts recommend that you buy when you need to and when the time is right for you.

Your agent is your expert on local market conditions. They can help you shape an offer that takes rising or falling prices and other special things about your area into account when writing an offer or assessing whether a property is a good deal for you.

The trends described above can help you discuss with your agent whether you’re likely to pay more by waiting or whether buying now makes more sense.