Home Prices Fell During COVID-19 in These Cities

Key Takeaways

• Data from Mashvisor shows that the average national home price is up 7.2% compared to pre-COVID levels.
• However, home prices have dropped in 16% of the cities analyzed.
• Minneapolis, MN witnessed the largest drop in home prices during COVID-19, with prices falling around 19%.
• New Orleans, LA leads the nation in home price gains, with prices rising 28%.

Mashvisor, a real estate data analytics company, conducted an analysis of home prices for over 100 US cities. The analysis looked at average prices in the months of January and February 2020 (pre-COVID-19) and compared them to house prices in October. The data reveals that the average national home price has increased by 7.2%, topping pre-COVID-19 levels.

These findings are based on the listings in Mashvisor’s US real estate database. However, most real estate outlets are reporting that US home prices have risen as well, including sources such as Realtor.com and Redfin.

Of the 125 cities analyzed by Mashvisor, 84% have enjoyed a rise in real estate prices. But of course, not all local real estate markets across the US are experiencing this trend during the pandemic. 16% of the cities studied actually saw home prices drop during 2020.

The cities represented above are those with a population of over 200k.

Top 10 US Cities Where Home Prices Dropped During COVID-19

Looking at cities with a population over 200,000, these are the top 10 where home prices saw the largest drop compared to pre-COVID-19 levels:

1. Minneapolis, MN: -18.6%
2. Tulsa, OK: -8.5%
3. Albuquerque, NM: -6.0%
4. Lubbock, TX: -5.3%
5. Grand Rapids, MI: -4.9%
6. Jersey City, NJ: -4.3%
7. Indianapolis, IN: -4.2%
8. Irvine, CA: -2.8%
9. Lexington, KY: -2.6%
10. Scottsdale, AZ: -2.4%

The Minneapolis housing market has experienced the largest drop in house prices this year. The main culprit of dropping prices is a rise in housing inventory. Mashvisor’s data shows a 143% increase in housing inventory from January to October 2020. Minneapolis Area Association of Realtors labeled the downtown area as a buyer’s market due to the increase in condos and townhouses for sale, which they report now outpace buyers in the area. A buyer’s market is usually accompanied by a drop in real estate prices as buyers have more options and sellers’ hands are sometimes forced if they wish to make a sale.

The situation is similar in the cities of Tulsa, Albuquerque, Grand Rapids, Jersey City, Irvine, Lexington, and Indianapolis, all of which saw a significant increase in housing inventory from January to October 2020:

• Grand Rapids, MI: +74%
• Jersey City, NJ: +29%
• Tulsa, OK: +28%
• Irvine, CA: +25%
• Indianapolis, IN: +25%
• Albuquerque, NM: +22%
• Lexington, KY: +4%

For the Scottsdale real estate market, housing inventory jumped 5% from February to October 2020.

Top 10 US Cities Where Home Prices Increased During COVID-19

1. New Orleans, LA: +28.1%
2. Columbus, OH: +27.7%
3. Birmingham, AL: +27.1%
4. Detroit, MI: +27.1%
5. Cleveland, OH: +26.3%
6. Garland, TX: +24.6%
7. Cincinnati, OH: +23.7%
8. Dallas, TX: +21.4%
9. Irving, TX: +19.4%
10. Baton Rouge, LA: +19.3%

The New Orleans real estate market leads the nation in price gains during the coronavirus, with an increase of 28.1%. Realtor.com actually named New Orleans one of the top 10 most-recovered markets for home prices in November. With housing supply low (Mashvisor’s data shows a drop in inventory of 6% from January to October) and demand high, there has been upward pressure on New Orleans home prices throughout the year.

Methodology

Mashvisor stores the data for homes for sale in its database, all of which come from the MLS. This data is also supplemented with listings from Zillow. This includes data like the home prices, days on market, as well as the number of listings in each city for each month.

The 125 cities included in the study are those that had at least 100 for-sale listings in Mashvisor’s database for the months analyzed. For every month used in the analysis, the average listing price for all homes for sale was calculated.