Housing prices keep rising, but when looking at the metro level it’s clear that the pace of growth is slowing in more and more places. Of the 50 biggest metro regions in the U.S., 32 of them had slower price growth April - June (Q2) than in January - March (Q1). This is a major change from even one year ago: in 2021, this only happened in 6 regions.

The map below compares Q2 growth to Q1 growth. Regions in blue had lower Q2 price growth than they had in Q1. Regions in red had higher Q2 price growth. I’ve also provided a table with the regions seeing biggest swings from Q1 to Q2.

As you can see, price growth slowed throughout the U.S., with some interesting patterns emerging.

Some takeaways from this data:

·        The mix of slower-growing regions is diverse, but leans westward, especially when looking at the bottom 10 list. Other than Phoenix, every metro area west of Dallas had slower Q2 growth. There are also some fast-growing southern areas like the Carolinas, Tennessee, and Georgia, plus several Midwestern regions.

·        The 18 regions with quickening price growth are led by the ultra-hot Florida markets, who built on fast price growth in Q1 with even faster price growth in Q2. But the Q2 risers also include many of America’s biggest cities: New York, Chicago, Phoenix, Dallas, Houston, and Boston. LA stands out as absent from this list. Overall, this group of 18 metros averaged 4.9% price growth in Q2, up from 4.2% in Q1.

·        The slower-growing regions are still seeing price growth. These 32 metros averaged 3.8% price growth in Q2, down from 5.2% in Q1.

Takeaways on price changes and Homeworthi scores:

·        Q2 price changes were generally well-aligned with Homeworthi’s (2-3 year) forecasts. The 10 regions with the biggest price increases had an average Near Term score of 79.7. Meanwhile, the 10 metros with the smallest price rises had an average Near Term score of 42. (This “bottom 10” average was affected heavily by Austin, which had a bottom-10 price increase despite its Homeworthi score of 97. The other regions on the bottom 10 list had an average score of 35.)

·        Q2 price changes were also aligned with Homeworthi’s long term (8-10+ year) forecasts, with an average score of 74 for the ten fastest-growing regions, and 52 for the bottom 10. Part of why the bottom 10 still has scores about 50 is that Homeworthi is expecting many of the top 50 markets to outperform smaller markets in the long term, thus keeping even the lower-performing bigger metro regions as decent investment bets.  

·        One outlier region I’ll be keeping an eye on is Miami. Miami is already considered overvalued by Homeworthi, and expects its prospects to further dim over time. All the same, it had the best Q2 price growth rate, and was 12th in Q1. Miami has always been propped up in by high rates of outside investment, but there was some evidence this was slowing. I’ll be interested to see if that starts to show in the home price data. If prices continue to surge, Homeworthi’s forecasts will slowly adjust. But not yet.