House Prices Are Falling Throughout Texas

House prices are falling across Texas, according to recent data, with the former pandemic boomtown of Austin reporting the most dramatic plunges in the entire state.

Journalist Lance Lambert, who curates his own house price tracker for the Resi Club, shared on X, formerly known as Twitter, the latest data on the 40 largest metro area housing markets in the country. According to his tracker, Austin recorded the biggest house price drop year-over-year of the list, with a 7.2 percent decrease between December 2022 and December 2023 and a 20.1 percent plunge since its 2022 peak.

Other Texas cities featured in Lambert's list reported significant price drops year-over-year, with San Antonio registering a 3.3 decrease between December 2022 and December 2023. In the same timeframe, Dallas and Houston saw home prices drop by respectively 0.5 percent and 0.4 percent.

While home prices have generally bounced back across the country after a modest correction of the housing market between late summer 2022 and spring 2023, prices have continued dropping across Texas. Austin and San Antonio both reported a drop of 1.0 percent in home prices between November 2023 and December 2023, while in Dallas prices slid by 0.7 percent and in Houston by 0.6 percent.

What these cities have in common, especially Austin and San Antonio, is that they used to be among the most overheated markets in the country. Austin and San Antonio experienced the highest home-price appreciation in recent years during the pandemic, when flocks of Americans from other states decided to move there because of the quality of life, the weather, or the cost of living.

Lambert commented on the price drops in Austin saying that "the telltale sign that Austin was still in correction mode early last year—despite home prices rising in the spring—was twofold" and due to inventory/absorption in the city and the fact that the price appreciation in the spring was "very subdued."

Newsweek contacted Lambert for comment by email on Thursday.

"There was an explosion of activity in Austin that just got too hot. And then there needed to be a correction," Redfin chief economist Daryl Fairweather previously told Newsweek. All the people who moved to Austin from more expensive cities like San Francisco and Los Angeles in recent years flooded the city's housing market with cash, bringing prices up. "Because prices have been so high, there was a lot of room for prices to fall," Fairweather said.

This correction appears to still be ongoing.

The average Austin home value was $527,205 as of December 31, down 8.2 percent compared to a year before, according to Zillow. Prices have been dropping consistently since reaching a peak of $630,308 in June 2022. In San Antonio, the average home value was $251,545 as of the same day, down 2.8 percent compared to a year before.

In Dallas, the average home was valued at $300,847, according to Zillow, up 0.0 percent compared to a year before. The company reports that prices in the city have been rising since April 2023, in line with the rest of the country. In Houston, Zillow reported that the average home was valued at $260,606 as of December 31, down 0.2 percent compared to a year before.