Seven of the 10 least-affordable markets in January were in the West, including San Francisco, Seattle and Los Angeles, according to Black Knight.

Laura Johnson, a 59-year-old technology project manager, put her Seattle house on the market in September for $800,000. In October, after dropping the price to $745,000 and getting no offers, she took the house off the market.

“In Seattle, sales just completely dropped off,” she said. 

Ms. Johnson relisted her home in February for $750,000. “I was very cautious about putting it back on,” she said. 

She cut the price to $740,000 last week. If she sells her home, Ms. Johnson plans to move to Florida.

Seven of the 10 least-affordable markets in January were in the West, including San Francisco, Seattle and Los Angeles, according to Black Knight.

Along with those, the quickest areas to slow down when mortgage rates rose in 2022 were the “Zoomtowns”—the metro areas that experienced rapid population growth during the pandemic as remote workers and retirees moved to lower-cost housing markets. 

The housing markets in cities such as Boise, Idaho, Phoenix, and Austin had become flush with money from out-of-state buyers and less affordable to those with local incomes. As rates climbed, demand slowed sharply, weighing on prices.

The median home-sale price in Idaho’s Ada County, which includes Boise, was $492,115 in February, down 10.5% from a year earlier, according to Boise Regional Realtors. That price is almost $130,000 above the median price nationally, making it unaffordable, or at least less of a bargain, for many out-of-state buyers. 

“Now you have to have some other compelling reasons why you are looking at the Boise market other than just pricing,”said Debbi Myers, president of Boise Regional Realtors. That’s good news for local shoppers, who are facing less competition, she said.

Nearly all the frothiest housing markets going into last year were West of the Mississippi River. In January 2022, an analysis from Florida Atlantic University and Florida International University named Boise, Austin and Ogden, Utah, as the most overvalued housing markets in the U.S. Eight of the top 10 most overvalued markets that month were in the West, Mountain West or Texas.

This year, some of the most stretched prices can be found further east, a sign that prices in these markets may turn negative on an annual basis soon. In January, the analysis found Atlanta, Cape Coral, Fla., and Charlotte, N.C., were the most overvalued, based on how far prices have risen above their long-term pricing trends.

The top 10 were all in the South and Midwest.

“Markets are overpriced,” said Ken H. Johnson, a real-estate economist at FAU, but “they’re not as overpriced as the markets a year ago.”

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