The best U.S. cities — and the worst — for home price appreciation in 2026

Where a property sits now determines its price direction. The AEI Housing Market Indicators report tracks appreciation for the 53 largest U.S. metros

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Where a homeowner lives now determines more about their property's value trajectory than any broad national trend. For most of the post-pandemic era, elevated mortgage rates and tight supply held prices up across most of the country, masking structural differences between local markets. The masking effect is dissolving. Metros that rode pandemic-era migration booms — particularly in Florida, Texas, and California — are shedding value in nominal terms. Metros in the Midwest and Mid-Atlantic that entered the post-pandemic period with lower price bases are gaining ground. The result is a housing market that no single national figure can adequately describe.

The mechanism behind this split is not uniform. In the markets losing value, the pattern reflects an earlier cycle. Sun Belt metros attracted large volumes of buyers from 2020 through 2022, pushing prices sharply above their historical relationship to local incomes. Buyers who stretched to purchase at those elevated levels now compete with higher inventory and softer demand. In the Midwest metros gaining value, the dynamic runs in the opposite direction: lower pre-pandemic price bases kept those markets affordable relative to wages, and they are still drawing households that relocated out of high-cost coastal areas. Affordability — or the memory of it — is driving migration decisions that now show up in appreciation data.

The American Enterprise Institute's housing market indicators report tracked year-over-year constant-quality home price appreciation across the 53 largest U.S. metros through March 2026. The dataset draws on public records and applies a quasi-repeat-sales methodology to control for mix shifts in home quality, producing figures the report describes as constant-quality, not simple medians. The findings document a geographic split between appreciating and declining markets that cuts broadly across regional lines, with the spread between the strongest and weakest metro reaching 16.5 percentage points.

Best: Kansas City draws buyers priced out of costlier markets

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Kansas City posted year-over-year home price appreciation of 9.0% in March, the highest among the 53 largest metros tracked. The figure marks a significant shift: the metro's appreciation rose from 1.2% in March 2025 to 9.0% in March 2026 for a swing of 7.8 percentage points.

The AEI report identifies Kansas City as an example of a metro where relatively low pre-pandemic home prices have attracted buyers seeking affordable alternatives to more expensive markets. Before the pandemic began in January 2020, Kansas City's prices were already lower than those in the coastal metros that experienced the sharpest appreciation between 2020 and 2022. The AEI data show that metros with lower entry-level prices before the pandemic generally saw modest appreciation during the peak boom years and have since experienced stronger gains. The report characterizes this trajectory as a reversion to the mean.

The broader context for Kansas City's performance is a national market where mortgage rates and home prices remain elevated by historical standards. Where elevated prices have depressed demand in higher-cost markets, Kansas City offers buyers a relative escape. Monthly payments on a median-priced property in Kansas City remain more accessible than in coastal metros, and that relative accessibility has drawn households that would otherwise face severe cost burdens elsewhere.........

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