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Zillow economists just published their updated 12-month forecast, projecting that U.S. home prices—as measured by the Zillow Home Value Index—will rise +1.2% between August 2025 and August 2026.
Heading into 2025, Zillow’s 12-month forecast for U.S. home prices was +2.6%. However, many housing markets across the country softened faster than expected, prompting Zillow to issue several downward revisions. By April 2025, Zillow had cut its 12-month national home price outlook to -1.7%.
However, in recent months, Zillow has stopped issuing downward revisions. In August, Zillow revised its 12-month outlook to +0.4%, and it is now revising that outlook to +1.2%.
“Sellers took a step back from the housing market in August in response to slow demand from cash-strapped home shoppers. Buyers still in the market have plenty of opportunity, especially in inventory-rich environments. But competitive momentum that has been swinging fast in buyers’ favor in recent months is showing signs of stopping nationwide,” Kara Ng, a senior economist at Zillow, wrote in a September report.
While Zillow’s national home price forecast is no longer negative—it isn’t exactly bullish either.
“High housing costs continue to sideline prospective buyers, making it easier for those still in the hunt. Zillow’s market heat index shows the market is balanced between buyers and sellers nationwide, with less competition among buyers than in any August since 2018,” Ng wrote. “Homes are lingering longer before finding a buyer as well. The median time on market for a sold home is 27 days—a full week longer than last year and one day longer than pre-pandemic norms.”
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Among the 300 largest U.S. metro-area housing markets, Zillow expects the biggest home price increase between August 2025 and August 2026 to occur in these 15 metros:
- Atlantic City, NJ → 4.7%
- Torrington, CT → 4.7%
- Saginaw, MI → 4.6%
- Pottsville, PA → 4.4%
- Rockford, IL → 4.3%
- Kingston, NY → 4.3%
- Concord, NH → 4.3%
- Knoxville, TN → 4.2%
- Hartford, CT → 4.1%
- New Haven, CT → 4.0%
- Hilton Head Island, SC → 4.0%
- Vineland, NJ → 4.0%
- Fayetteville, AR → 3.9%
- Norwich, CT → 3.9%
- Youngstown, OH → 3.7%
Among the 300 largest U.S. metro-area housing markets, Zillow expects the biggest home price decline between August 2025 and August 2026 to occur in these 15 metros:
- Houma, LA → -7.9%
- Lake Charles, LA → -7.5%
- Lafayette, LA → -5.3%
- New Orleans, LA → -4.8%
- Beaumont, TX → -4.5%
- Shreveport, LA → -4.5%
- Alexandria, LA → -4.5%
- Odessa, TX → -3.3%
- Corpus Christi, TX → -3.2%
- San Francisco, CA → -3.0%
- Santa Rosa, CA → -2.7%
- Monroe, LA → -2.7%
- Chico, CA → -2.6%
- Texarkana, TX → -2.6%
- Austin, TX → -2.4%
U.S. home prices, as measured by the Zillow Home Value Index, are currently down +0.01% year over year. If Zillow’s latest 12-month outlook (+1.2%) comes to fruition, it would represent a tiny acceleration.
Below is what the current year-over-year rate of home price growth looks like for single-family and condo home prices. The Sun Belt, in particular Southwest Florida, is currently the epicenter of housing market weakness right now.
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