53% of Home Values Declined in U.S. Last Year

Q: Does “53% of homes lost value” mean a housing crash?

Not by itself. Zillow also reports only 4.1% of homes are below their last sale price, meaning most owners still have equity.

Half the country is watching home values slide. South Florida is quietly becoming the exception. If you’ve seen headlines saying Home Values declined in the U.S, you’re not imagining it. Zillow’s latest data shows 53% of U.S. homes lost value over the past year (the highest share since 2012).

But here’s the part most people miss: a short-term dip is not the same thing as being “underwater,” and it’s not the same thing as losing the long-term wealth many owners built since they bought.

Key Takeaways

Home Values declined in the U.S means year-over-year estimated values fell for 53% of homes.
Only 4.1% of homes are worth less than their last sale price, which shows most owners still have a cushion.
South Florida has had more year-over-year declines, but many owners are still far ahead since purchase (Miami’s median change since last sale is 84.6% in Zillow’s table).

What “53% of Homes Lost Value” Really Means

When people say Home Values declined in the U.S, they are usually talking about year-over-year changes in Zillow’s value estimates (Zestimates/Zillow Home Value Index methods).

That matters because:

It’s a 12-month snapshot, not a lifetime result.
It’s a value estimate trend, not a closed sale price.
A home can be down from last year and still be way up from when the owner bought it.

Zillow also shows that while Home Values declined in the U.S for many properties, losses since the last sale are still rare. Nationally, the median change in value since the last sale is 67.2%, and only 4.1% of homes are below their last sale price.

Where the Declines Are Concentrated

The headline that Home Values declined in the U.S hides a big truth: not all markets move the same way. Zillow’s metro breakdown shows the largest shares of year-over-year declines are heavily clustered in the South and West.

Here are examples from Zillow’s published metro table:

Denver: 90.6% of homes lost value year over year
Austin: 89.5%
Phoenix: 86.9%
Dallas: 86.7%

Meanwhile, many big metros in the Northeast and Midwest show much lower shares:

New York: 21.1%
Chicago: 22.9%
Boston: 20.7%

Why Other Reports Don’t Match Zillow

It’s easy to feel whiplash when you read that Home Values declined in the U.S and then see another report saying the market looks “fine,” but that’s usually because each source measures a different part of housing, forecasts, closed sales, or local activity. Here’s how the major reports break down:

Realtor.com (forward-looking forecast): Focuses on what might happen next. Realtor.com projects continued cooling across Florida and estimates that median sales prices across the state’s eight largest metro areas could fall an average of 1.9% in 2026.
Redfin (closed sale prices): Focuses on what buyers actually paid in recent closings. Redfin shows Miami’s median sale price was about $620,000 in November 2025, down 7.5% year over year, with homes taking longer to sell than the year before.
MIAMI REALTORS® (local activity + inventory): Focuses on what’s happening on the ground—sales volume, cash share, inventory, and months of supply, often pointing to a market that is rebalancing instead of dropping fast. For example, its October 2025 stats show roughly 5.1 months of supply for Palm Beach single-family homes (closer to balance) and about 9.1 months for Palm Beach condos/townhomes (more buyer leverage), alongside modest year-over-year median price changes in several categories.

The main thing is not to mix up two separate questions: whether Home Values declined in the U.S over the last year, and whether homes are actually worth less than what owners paid. Zillow’s data shows that while year-over-year declines have become more common, only 4.1% of homes nationwide are valued below their last sale price and just 3.4% of new listings are priced under their previous sale value. South Florida is a good example of this “two truths” issue, Zillow shows Miami with 75.9% of homes down year over year, yet the median change in value since the last sale is still 84.6%, meaning many owners remain well ahead despite recent softening.

Mortgage Rates Set the Mood (Even in Cash-Heavy Markets)

Mortgage rates are national averages, but they still shape buyer behavior almost everywhere. Freddie Mac’s weekly survey put the average 30-year fixed rate at 6.16% as of January 8, 2026, and while forecasts differ, two commonly cited outlooks suggest rates may ease only slightly, Fannie Mae projects rates ending 2026 around 5.9%, while Realtor.com forecasts an average near 6.3% in 2026. When rates stay elevated, markets that rely more on financing tend to feel more pressure, which is one reason Home Values declined in the U.S isn’t evenly distributed across every region and metro.

Florida Insurance: A Real Cost That Affects Demand

Insurance is one of the biggest “local” factors that can change affordability in Florida.

Citizens recommended rate cuts for many policyholders and proposed a statewide average 2.6% decrease for personal lines in its 2026 filing materials.
Separately, the Insurance Information Institute has pointed to Florida’s high premium environment (with reporting that Florida averages around $3,815 annually in some summaries).

Even if Home Values declined in the U.S, monthly costs can still rise if insurance and HOA fees climb. That’s why buyers in South Florida often focus on “total payment,” not just price.

FAQ About the Declining Home Values in the U.S.

What does it mean that Home Values declined in the U.S last year?

It means many homes had lower estimated values compared to a year earlier. Zillow reports 53% of homes fell year over year, based on Zestimates.

Does “53% of homes lost value” mean a housing crash?

Not by itself. Zillow also reports that only 4.1% of homes are below their last sale price, meaning most owners still have equity.

How many homes are worth less than their previous sale price?

Zillow reports 4.1% nationally are below their last sale price.

Why do Zillow and forecast reports show different results?

Zillow reports what happened to year-over-year values. Forecasts estimate what may happen next. For example, Realtor.com projected Florida’s largest metros could average a 1.9% price drop in 2026.

Are Miami-area homes seeing year-over-year declines?

Zillow’s metro table shows Miami had 75.9% of homes down year over year, but the median change since last sale was still 84.6%.

What are mortgage rates right now?

Freddie Mac’s weekly average showed 30-year fixed at 6.16% as of January 8, 2026.

How important are cash buyers in South Florida?

MIAMI REALTORS® reported 38.8% cash sales in October 2025, compared with national cash shares around 29% reported by NAR for October 2025.

Local help for buyers, sellers, and investors in South Florida

If you’re trying to make sense of headlines like Home Values declined in the U.S, the smartest next step is looking at what’s happening in the exact neighborhoods you care about, recent closings, listing competition, condo vs. single-family trends, insurance costs, and how cash buyers are shaping demand. South Florida is a patchwork of micro-markets, and the right decision often comes down to details like building rules, HOA budgets, flood zones, and how pricing shifts from one block to the next.

For clear, hands-on guidance across South Florida communities, reach out to The Mastropieri Group, Realtors at (561) 544-7000.