The once booming U.S. housing market has cooled down considerably. Higher mortgage rates, lofty home valuations and a lack of inventory has kept a lid on both sales and price growth in many places.
Fortunately, there is no evidence to date that this slowdown is going to cause the housing market to collapse as it did in the early 2000s. But a handful of markets still appear headed for a period of hard times.
The following U.S. markets are showing some signs of real trouble. How long those difficulties will last — and how deep they will go — is anyone’s guess.
Punta Gorda, Florida
When the housing bubble of the early 2000s burst, prices in Punta Gorda plunged more than 47% from their peak. Now, history may be repeating itself in this city in southwest Florida.
After soaring more than 73% during the recent real estate boom tied to the COVID-19 pandemic, prices in Punta Gorda are falling fast. A Fast Company report found that prices are already 9% below their 2022 peak and likely have further to fall.
New Orleans
A combination of high mortgage rates and rising homeowners insurance premiums has deeply damaged the housing market in New Orleans, Louisiana. June closed home sales fell 24.3% compared with the previous year, according to a Newsweek report.
Prices are still rising in the city, but experts say they might begin to falter sometime later this year.
Austin, Texas
During the pandemic, Austin was among the hottest housing markets in the nation. Now, the market is in “acute distress,” according to a Parcl Labs study.
Demand has fallen sharply, and some properties are seeing price cuts of more than 30%. Southeast Austin is taking the brunt of the correction.
Other markets at risk of correction
Although the aforementioned markets are struggling more than most, they are not the only ones facing challenges.
Recently, analysts at Realtor.com did a little number crunching and determined that in several U.S. markets, “list prices appear fated to fall in coming months.”
To find out which cities made the list, check out “7 Places Where Home Prices Are Due for a Correction.”
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