The Blubber

Home values are beginning to decline in much of the United States, signaling a possible turning point for the housing market as broader economic conditions weigh on real estate.

According to new data from Zillow, monthly home prices fell in 27 out of 50 states between March and April of this year. Some of the sharpest declines were seen in Florida, Colorado, Washington, D.C., California, and Washington state—regions that had previously experienced some of the strongest price appreciation in the post-pandemic boom. The recent shifts suggest a wider correction may be underway in the U.S. housing sector.

“The downward trend in home values is being driven by a troubling mix of factors,” said Alex Beene, a financial literacy educator at the University of Tennessee at Martin. He noted that high interest rates, persistent inflation, and broader economic uncertainty are keeping many would-be buyers on the sidelines. This has created new pressures in markets that had become overheated during the last several years.

For the past few years, low housing inventory helped prop up home prices nationwide. But that dynamic appears to be changing. With more homes now entering the market, the balance between supply and demand is beginning to shift—and prices are following suit.

Even so, many potential homebuyers remain locked out of the market due to mortgage rates that remain near two-decade highs. As a result, demand has softened, even as more homes become available, leading to localized declines in property values.

Zillow’s data paints a picture of a housing market that is no longer just cooling in isolated areas, but instead undergoing a broader recalibration. In addition to Florida and Colorado, states like Arizona, Louisiana, West Virginia, Texas, and Georgia also recorded modest drops in home values. These declines ranged from 0.37 percent to 0.55 percent month-over-month, with Florida seeing the steepest losses.

Nick Gerli, CEO of real estate analytics platform Reventure, described the shift as a meaningful inflection point. “The broadening of this housing decline suggests there's a real transition underway in the U.S. housing market,” he wrote on X (formerly Twitter). “Inventory is rising in most regions, and more sellers are realizing they’re overpriced and starting to make cuts.”

Even California, a state known for its consistently high demand and some of the steepest home prices in the country, showed signs of cooling. Although home values in the state are still up 1.3 percent year-over-year, they fell by 0.42 percent in April alone.

Gerli emphasized that the implications of this trend could be significant for the year ahead. “This data is crucial for anyone tracking the housing market—whether you’re a buyer, a seller, or an investor,” he said. “The real question isn’t whether prices will fall, but where they’re dropping and by how much.”