These 10 Cities Are Expected To See the Biggest Home Price Drops in 2026

Zillow's latest Home Value Index forecast projects national home prices to be essentially flat over the next 12 months, shifting by just -1.0%. While that might make the housing market in America appear stable on the surface, there are plenty of cities where prices are expected to drop dramatically.

If you own property in one of the cities below, knowing what's coming is one of the smarter ways to protect your home budget before you make any decisions about selling or staying put. Conversely, if you're looking for an affordable area that fits your budget, one of these cities could be perfect for you.

Here are the 10 cities that are expected to see the biggest drops in housing prices in 2026.

Indianola, Mississippi

Projected price drop: -10.8%

Indianola has been losing residents for years, and the pace hasn't slowed. The population is declining at 2.03% annually and has fallen over 10% since the 2020 census, with a median household income of $41,708 and a poverty rate of 30.55%.

These conditions have been building over decades of outmigration and don't turn around without significant outside investment or a meaningful employment catalyst, neither of which is visible in the near-term forecast.

Morgan City, Louisiana

Projected price drop: -11.3%

Morgan City is a working-class Gulf Coast city on the Atchafalaya River, about 70 miles southwest of Baton Rouge, built around offshore oil production and commercial fishing.

Analysts tracking Louisiana's smaller metros flag Morgan City as especially sensitive to global energy price swings and to the growing costs of operating in a coastal environment. Throw in the potential for massive flood damage, and you could see why buyers are having second thoughts about moving to Morgan City. With sky-high insurance premiums, many potential buyers are looking elsewhere in the state.

Hobbs, New Mexico

Projected price drop: -11.4%

Hobbs is a Permian Basin energy town where housing demand tracks directly with drilling activity: Workers arrive when rigs are running and leave when they're not, and the housing inventory that gets built during booms has nowhere to go during slowdowns. Given the rapidly shifting energy markets, potential home buyers are not coming to Hobbs, and the ones who are are making lower-priced offers.

Opelousas, Louisiana

Projected price drop: -11.5%

Opelousas is in St. Landry Parish, about an hour west of Baton Rouge in the heart of Cajun Louisiana. The reason buyers are so hesitant isn't just the price tag on homes. Years of hurricane damage and flood claims have driven insurance premiums to levels that genuinely change the affordability math, even as list prices fall.

A house priced at $120,000 with $5,000 or more per year in insurance and flood coverage isn't cheap in any practical sense, and buyers who understand that reality are pricing accordingly.

Raymondville, Texas

Projected price drop: -11.5%

Agriculture, specifically citrus and cotton, along with some government employment, forms the economic base here, but it's shaky. The projected 11.5% decline reflects what happens in a small agricultural market when population declines faster than demand is able to be replaced.

Markets like this have very little economic depth to absorb disruption when the dominant local industry slows, or a major employer downsizes, and Raymondville has less cushion than other small Texas markets.

Bennettsville, South Carolina

Projected price drop: -11.9%

Bennettsville is the seat of Marlboro County, which ranks among the poorest counties in South Carolina by most measures. Marlboro County is more exposed than most because manufacturing, which kept this area employed through several decades of economic changes, has been pulling back steadily and hasn't been replaced by anything comparable. With no new industry in the city, potential buyers are not willing to pay top dollar for a house.

Cleveland, Mississippi

Projected price drop: -13.6%

Cleveland is part of a cluster of Mississippi Delta markets such as Greenville, Clarksdale, Greenwood, and Indianola, all of which share the same profile of declining populations, weak local employment bases, and housing inventories that consistently outpace demand. There simply isn't enough industry to attract new workers and, thus, new homebuyers.

Pecos, Texas

Projected price drop: -13.7%

Pecos is a Permian Basin city, which means its economy and its housing market both move with oil. When energy production is strong, workers flood in, demand for housing spikes, and prices follow. When activity cools, Pecos absorbs the correction more severely than most Texas cities because it lacks a diversified economic base to cushion the fall. That uncertainty is a main driver of the price drop.

Clarksdale, Mississippi

Projected price drop: -14.8%

Clarksdale markets itself as the birthplace of the blues, and while the cultural identity is real, the housing trajectory is not a story anyone wants to tell. The underlying problem is that Clarksdale carries some of the highest poverty rates in Mississippi, which means the pool of qualified buyers is thin and has been shrinking for years as residents relocate to larger metro areas with more employment options.

Greenville, Mississippi

Projected price drop: -16.7%

The Mississippi Delta's economy has been built on agriculture for generations, and that foundation has been quietly deteriorating as commodity prices shift and younger residents leave for better job markets. Without a growing local workforce, there simply aren't enough buyers to absorb the homes coming to market, and repeated flooding has pushed insurance premiums to the point where ownership doesn't make sense even at discounted prices.

Bottom line

Every city on this list is dealing with a version of the same problem: an economy that can't generate enough buyer demand to support the housing stock it already has. Prices run up during a period of national enthusiasm, local demand never catches up, and then the correction arrives, with prices tumbling.

This is a great market for those looking to purchase a new house. According to Chicago Agent Magazine, 39% of home sellers nationally now plan to offer concessions to buyers in 2026, up from 30% in 2025. In markets where prices are falling in the double digits, that number is almost certainly higher, meaning buyers who do show up have meaningful negotiating leverage over price, closing costs, and terms. The best way to prepare yourself financially in any of these markets is to know your exit before you enter.