U.S. home prices are currently rising, but only by a small amount and not in every city. Three leading indicators show that the average home price in the U.S. rose between 0.7% and 2% over the past year or so (as of June 2026).
U.S. Home Prices Are Rising Slightly in 2026
Home prices in the U.S. have mostly risen over the past 10 years, aside from a brief downturn that followed the pandemic-era housing market boom.
Here’s how the median or average home price has changed over the past year, according to three authoritative sources:
- Redfin Data Center: The U.S. median sale price was about $399,000 in June 2026, an increase of 2% compared to a year earlier. (source)
- Zillow: “The average United States home value is $370,320, up 0.7% over the past year,” according to a June 2026 statement.
- S&P Cotality Case-Shiller: The national average home price is up by 0.67% year over year, as reported in June.
These sources report different numbers because they measure differently. But they agree on one thing: house values have risen slightly over the past 12 months.
So yes, home prices in most U.S. cities are currently rising in summer 2026. But there are still some housing markets where they continue to drop.
Regional Variation and Where Prices Are Falling
As mentioned, most cities currently have “flat” home prices or modest growth.
But there are also plenty of cities across the U.S. where prices continue to decline in 2026.
A lot of these “softer” markets are located in the Sun Belt and the West, while markets located in the Midwest and Northeast are currently stronger with modest price growth.
Many of the Sun Belt housing markets ramped up construction during the pandemic to meet the surge in demand from buyers.
But when mortgage rates rose and buyers backed off, the excess inventory of homes led to slower sales and falling prices.
Here’s a key distinction we’re seeing in mid-2026:
- Climbing Markets: In the Northeast, Midwest, and Rust Belt (places like Newark, NJ; Nassau County, NY; Chicago, and Detroit), home prices continue to rise due to a severe lack of housing inventory. This has led to intense buyer competition and frequent bidding wars despite high interest rates.
- Falling Markets: Prices are dropping in pockets across the West and Sun Belt (such as Austin, Miami, and Cape Coral), where a combination of pandemic-era overheating, a sudden surge in active housing supply, and escalating home insurance costs have triggered a regional correction.
These variations emphasize the need for localized market research. National headlines might say prices are rising or falling. But this varies significantly at the local level.
A Look Back: Price Trends Over the Past 8 Years
Hindsight tells us whether home prices are rising or falling. To understand what’s happening in the present, we have to take a look at the past.
The following graph was created using data provided by Zillow. It shows the average or typical home price in the U.S. going back about eight years.
You can see how home prices skyrocketed during the pandemic years from 2020 to 2022, rising by roughly $100,000 in that two-year span.
That was an unprecedented rate of growth, and the market is still getting back to normal.
This also helps to explain why home prices continue to fall in some U.S. cities, even as the national median price inches upward.
To put it simply: the cities that experienced the most price growth during the pandemic years had further to fall, so they’re still coming back down to earth.
Factors Causing Upward and Downward Pressure
Some economic forces are currently boosting prices, while others are suppressing them. This interplay will determine whether home prices in your area rise or fall, going forward.
Here are some of the primary forces shaping the market in 2026:
Forces That Are Pushing Prices Up
- The “Rate Lock-In” Effect: A lot of current homeowners have mortgage rates below 4% that they secured a few years ago. Giving up those low rates to buy a new home at today’s higher rates would be painful. So many of them are choosing to stay put. This limits the supply of homes for sale, putting upward pressure on prices.
- Strong Demographic Demand: Millennials (the largest demographic cohort in U.S. history) are well into their prime home-buying years. This creates a steady stream of demand from first-time buyers who need housing, regardless of economic conditions.
- Historical Inventory Shortages: While inventory has recovered in some regions, the U.S. housing market as a whole still suffers from a construction shortage that goes way back. In many cities, there simply aren’t enough homes to meet the demand from buyers, which naturally drives up competition and prices.
Forces That Are Pulling Prices Down
- Affordability Constraints: The combination of elevated mortgage rates and peak home prices has pushed monthly housing payments to historic highs. This creates a natural “ceiling” for home prices. When buyers simply cannot qualify for loans or afford the monthly payments, demand drops, forcing sellers to reduce their list prices.
- New Construction: In certain regions (but not everywhere), home builders have stepped in to meet the demand, flooding local markets with newly built inventory. This is particularly true in parts of the Sun Belt, where a surge of completed homes has given buyers more options and negotiation leverage, weakening prices.
- Rising Homeownership Costs: It’s not just mortgage payments that are getting more expensive. Skyrocketing homeowners insurance premiums and rising property taxes in states like Florida, Texas, and California are stretching buyer budgets. These rising “holding costs” are making buyers more conservative with their offers.
How to Read Your Local Market (A Quick Checklist)
National headlines often group the entire country into a single average. So they don’t show what’s happening in your specific neighborhood.
If you want to know whether home prices are rising or falling in your local area, you have to look at the local indicators.
Here are three specific market metrics to look for, using the tools listed below:
1. Months of Inventory (MOI)
Months of inventory (or “months of supply”) measures how long it would take for all the active homes on the market to sell at the current pace of sales, if no new listings were added. This is arguably the best metric for predicting price direction.
- Prices Will Likely Rise: Less than 4 months of inventory. Scarcity keeps buyer competition high, preventing prices from falling.
- Prices Will Probably Stay Flat: 4 to 5 months of inventory. Supply and demand are in equilibrium, leading to slow, stable price movement.
- Prices Will Likely Fall: More than 5 or 6 months of inventory. Sellers must lower their expectations and compete harder for offers.
Note: It’s an imperfect science. In rare cases, we might see home values fall even when there’s very little inventory. But it usually follows the framework above.
2. Median Days on Market (DOM)
This metric tracks the overall pace of the market, by measuring how long a typical property stays on the market before going under contract. Look at the current median DOM for your city and compare it to the same time last year.
- Signs of Strength: If homes are going into escrow in under 30 days, demand is strong. Sellers maintain the leverage, and prices are likely rising or holding firm.
- Signs of Weakness: If the median DOM is climbing well past 45 days, the market is losing steam. When properties sit longer, sellers eventually reduce their list prices.
3. Percentage of Listings with Price Drops
This is a responsive “real-time” indicator. Real estate tracking sites often show the percentage of active listings that have reduced their original asking price.
- A Rising Market: In low-inventory markets, only 10% to 15% of homes might see price drops because initial pricing is supported by strong competition.
- A Correcting Market: If 25% or more of the active listings in your area show price cuts, it shows that sellers are overestimating buyer demand. This is a sign that home values in the area may be starting to trend downward.
The Takeaway: Don’t rely on national reports for local insights. Look at local metrics for your zip code to find out where prices might be headed in your area.
Where to Find Local Housing Market Data
You don’t need expensive industry software to track these metrics. Several authoritative sources provide free and local data libraries that are regularly updated:
- Redfin Data Center: Their public dashboard allows you to filter down to your specific city or county to view clean, interactive charts tracking median sale prices, months of supply, and the percentage of listings with price cuts.
- Realtor.com Data Library: Best for raw, zip-code-level tracking. Navigate to their “Economic Research” page to find monthly data downloads showing active listing counts, median list prices, and “Market Hotness” metrics for your neighborhood.
- Local and State REALTOR® Associations: Best for local market analysis. Search for your specific state or city real estate board (e.g., the California Association of REALTORS®). They typically publish a highly localized, easy-to-read market summary during the first week of every month.
- Zillow Real Estate Research: Best for tracking long-term value trends. Their research portal features the Zillow Home Value Index (ZHVI), along with local market overviews that show how your metropolitan area’s inventory and price cuts stack up against national averages.
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About the Author
Brandon Cornett is a housing market analyst and creator of the Home Buying Institute.
He has been tracking and reporting on real estate trends in the United States for more than 20 years.
Brandon also publishes Housing Weekly, our flagship newsletter that delivers exclusive insights analysis. You can sign up for his newsletter using the link provided above.