Mid-Tier Prices Below Prior Peaks in 28 of 33 Big, Expensive US Cities

Mid-tier home prices in America's largest and most expensive urban markets remain below their previous peaks in a clear majority of cities, according to Wolf Street's July 2026 update, which tracks prices across 33 big, expensive cities in 33 charts.

Prices of mid-tier homes — single-family houses, condos, and co-ops — were down from their respective peaks in prior years in 28 of the 33 cities tracked, led by Austin (-27%), Oakland (-25%), and New Orleans (-19%). In most of those cities, the highs were set either in 2022 (17 cities) or in 2024 (9 cities). In two cities, the highs occurred in early 2025: Boston (April 2025) and San Jose (January 2025). That mix matters because it shows how uneven the post-boom reset has been: some markets are still working through the aftereffects of the mid-2020 to mid-2022 surge, while others are already testing more recent peaks.

Year over year, prices declined in 24 of the 33 cities, led by Austin (-4.4%), Las Vegas (-3.1%), and Nashville (-3.0%). In 2 of the 33 cities, home prices rose to new highs: Chicago and New York City.

San Francisco: AI Demand Trickles Down From a “Mansion Shortage” to Mid-Tier Homes

San Francisco, described by the article as the epicenter of AI, is where AI mania has bled into the housing market. It began in the luxury segment, producing what is referred to as a “mansion shortage.” In recent months, the effects have trickled down into the mid-tier market tracked here, and mid-tier prices have begun to spike.

In July, mid-tier prices in San Francisco spiked by 1.5% from June, bringing the year-over-year increase to 11.6%. Not long ago, the city was near the top of the list of home-price declines; in the second half of last year, mid-tier prices flipped from declining to surging. Despite the spike since then, July prices remained 6% below the all-time high of 2022. Given the magnitude of the recent increases, the article observes, and if AI mania lasts long enough, mid-tier prices could set a new high before year-end for the first time since 2022.

Boston Joins the Line-Up of Declining Cities

Earlier this year, Boston joined the line-up of cities with price declines from highs in prior years. Mid-tier home prices there fell by 0.5% in July from June, by 1.4% year over year, and by 2.3% from the high reached in April 2025.

The Boom That Preceded the Declines

The current declines come off a price explosion in these cities during the two years between mid-2020 and mid-2022, including in Austin (+62%), Phoenix (+60%), Fort Worth (+50%), Raleigh (+49%), and Sacramento (+39%) — gains that came on top of already high prices.

The article attributes the home price explosion to Federal Reserve monetary policy, which the author characterizes as reckless: trillions of dollars of purchases of Treasury securities and mortgage-backed securities (MBS), carried out with newly created money, producing mortgage rates below 3% even as inflation was surging at the time toward 9%. Americans responded with off-the-chart FOMO buying behavior, the article recounts — a fear of missing out centered on mortgage rates, with people trampling over each other and bidding up prices in order to buy a home and lock in those mortgages.

In cities where prices have since dropped from those peaks, these buyers now hold below-3% mortgages on homes whose prices have fallen — and they are fine, the article notes, as long as they stay put.

Methodology: The Mid-Tier Zillow Home Value Index

The price index used here is the seasonally adjusted, three-month-average mid-tier Zillow Home Value Index (ZHVI) for single-family homes, condos, and co-ops. “Mid-tier” means the middle third by price in each market.

The ZHVI is a backward-looking measure based on millions of data points in Zillow's “Database of All Homes,” including transaction data from public records (tax data), MLS, brokerages, local Realtor associations, real-estate agents, and households across the US. It includes pricing data for off-market deals and for-sale-by-owner transactions.

To qualify for the list, a city must be one of the largest by population and be among the expensive cities where the ZHVI for all mid-tier homes (single-family, condos, and co-ops) reached at least $300,000 at some point. Some large cities do not qualify because their mid-tier ZHVI never reached $300,000 despite the surge in recent years — among them Memphis, Oklahoma City, Tulsa, Kansas City, Cincinnati, Pittsburgh, and many others. Houston and Philadelphia are included anyway, because they are the fourth-largest and sixth-largest cities in the US.

In those less expensive cities, the article notes, five mid-tier homes combined sell for less than one mid-tier home in San Francisco. Not every city in America is an expensive housing market; some cities have quite reasonable prices.

Reading the Charts

The 33 city price charts appear in the original article. In the accompanying tables, MoM means month over month and YoY means year over year; the column furthest to the right shows the percentage increase “since 2000.” All figures are seasonally adjusted. Captions accompanying individual city charts in the original include “Lowest since March 2021,” “Prices are where they'd first been in October 2017,” and “Where prices had first been in December 2019.”

Related Wolf Street coverage: Sales of Existing Single-Family Homes Sink Deeper into Mud, Supply Jumps to 10-Year High, Condo Supply at 14-Year High

Source: Wolf Street