US Home Prices Going Negative in 2026: AEI Projects First Decline Since 2012

# US Home Prices Going Negative in 2026: AEI Projects First Decline Since 2012

> **Quick answer:** The American Enterprise Institute (AEI) projects US single-family home prices will turn negative in April 2026 — the first decline since 2012. Their base case forecast is -1% by year-end 2026, followed by -2% drops in both 2027 and 2028. As of February 2026, national price growth had already slowed to just 1.1% year-over-year, with 28 of the nation's 53 largest metros already in negative territory.

US home prices going negative in 2026 is no longer a worst-case scenario — it's AEI's base case. The American Enterprise Institute's March 2026 Housing Market Indicators report, authored by economists Edward J. Pinto, Tobias Peter, and Sissi Li, shows the housing market has reached an inflection point not seen since the aftermath of the 2008 financial crisis.

## What the AEI Data Actually Shows

The numbers tell a sobering story. National home price appreciation (HPA) stood at just 1.1% year-over-year in February 2026 — the slowest rate since AEI began tracking the series in 2012. That's down from 1.6% the prior month and a sharp drop from 3.1% a year ago and 6.3% in February 2020.

AEI's three-scenario forecast for year-end 2026: