Most homes in the United States have experienced a decline in value over the past year, with Texas cities seeing some of the largest drops. According to Zillow, 53 percent of homes nationwide lost value this year. In the Texas Triangle—Dallas, Houston, Austin, and San Antonio—the average share of depreciated homes is over 85 percent.
Austin has seen the steepest decrease among major U.S. metropolitan areas since the last market peak. The city, which saw rapid growth during the pandemic as a tech hub, has recorded a 20 percent drop in home values based on Zillow’s Zestimate data.
The trend is also reflected in listing prices. Austin, San Antonio, and Dallas are among the top five cities where listings are priced below their previous sale price. While San Francisco leads with 14 percent of homes valued under their last sale price, Austin follows closely at 13 percent. In San Antonio and Dallas, those figures are eight and seven percent respectively.
Despite these declines, analysts say recent losses do not erase gains made over the past six years. “This year’s decline is a normalization, not a crash,” said Zillow analyst Treh Manhertz. “The vast majority of homeowners still have significant equity,” Manhertz added.
However, single-family investors who purchased properties during or after the pandemic may be more affected by falling values. These sellers represent a notable portion of Texas’ housing market.
In 2021, Texas had the highest rate of homes sold to institutional investors nationwide, especially in counties such as Tarrant and Rockwall near Dallas-Fort Worth (DFW). In Austin specifically, investor-owned homes typically accounted for less than 20 percent of inventory before the pandemic but surged to nearly one-third during that period.
As single-family home investments become less profitable amid declining values and rents—particularly in Sun Belt cities like Dallas—the market has seen more homeowners renting out properties instead of selling them. This shift has contributed to rent decreases in some areas.
