Housing Market Shows Signs of Change as Home Prices Drop in Key Western Cities

New data shows home price reductions rising in western cities, with mortgage rates at two-year highs.

October 1, 2026 One Min Read

POLICY WIRE — Washington, D.C. — A recent analysis of the U.S. housing market has revealed a notable increase in home price reductions, with 20% of listed homes seeing lower prices in September, the highest rate this year, according to Realtor.com.

The surge in available homes, up 5.4% compared to last year, is creating more options for buyers, but high mortgage rates remain a challenge. The average 30-year fixed-rate loan now stands at 7%, the highest in two years, following the Federal Reserve’s recent interest rate hike.

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Western states led the way in price cuts, with 22.8% of homes reducing their asking prices, while Salt Lake City, Utah, had the highest share at 33.6%. Despite these trends, buyer activity remains cautious, with a 4.1% decline in homes under contract compared to the same period last year. However, experts suggest that the combination of lower prices and increased inventory could signal a shift in the long-stagnant market.

Reporting by Policy-Wire (PW)

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