Zillow Forecasts Home Price Drops in 20 Cities as Inventory Surges 24.8%

Home prices in Greenville, Mississippi, are forecast to fall 16.7% over the next 12 months. This is the steepest decline predicted by Zillow, which anticipates a nationwide housing correction of 1.0%. The drop is driven by sustained high interest rates that have pushed reluctant sellers to list their homes. Many homeowners had delayed selling to avoid surrendering low fixed-interest mortgages, but after three years of higher rates, they can no longer delay moving. This has led to a surplus of inventory, with Realtor.com reporting a jump in housing inventory of 24.8% over the last year. In small cities, price volatility is higher due to lower volume. Forecasts include declines of 14.8% in Clarksdale, Mississippi; 13.7% in Pecos, Texas; 13.6% in Cleveland, Mississippi; 11.9% in Bennettsville, South Carolina; 11.5% in Opelousas, Louisiana; 11.5% in Raymondville, Texas; 11.4% in Hobbs, New Mexico; 11.3% in Morgan City, Louisiana; and 10.8% in Indianola, Mississippi. In larger metropolitan areas, the corrections are smaller in percentage, but the higher starting prices mean a steeper drop in dollar amounts. New Orleans, Louisiana, is forecast to drop 7.2%, followed by San Francisco, California, at 6.1%, Austin, Texas, at 5.1%, and San Jose, California, at 4.0%. Other major metros include Honolulu, Hawaii, at 3.8%, Denver, Colorado, at 3.8%, Sacramento, California, at 3.7%, San Antonio, Texas, at 3.6%, Portland, Oregon, at 3.5%, and Washington, D.C., at 3.3%.