The cities where house prices are most likely to fall

Homes, like stocks, are in a period of divergence right now.

Why it matters: When you buy a stock, the chances of it broadly mirroring the market as a whole are now pretty low. In housing too, different markets around the country are likely to diverge significantly.

• How it works: Recent research from hedge fund DE Shaw shows that in 2021, the Nasdaq-100 index had an extremely strong positive correlation with bond yields, while the Russell-1000 value index had an equally strong negative correlation.
• 20 years earlier, all such correlations were extremely weak, and insofar as they existed, they were the other way around.

Driving the news: An analysis by Home.LLC for Axios looks at market conditions in 100 metropolitan areas around the country to see which markets are the riskiest — which is to say, the most likely to see modest price declines over the next 12 months.

• The national housing supply shortage is real — except for in certain cities, including Boise, Idaho; Austin, Texas; and Phoenix, that have fewer restrictions on new construction and are going to see a substantial number of new units hit the market.
• Austin is also likely to see a significant drop-off in demand, just because homes have become so expensive there that they are no longer affordable to most locals looking to buy.

The bottom line: House price dynamics in markets like Cleveland and Detroit are still pretty constructive — but that's not true in the sun belt.

• The riskiest markets over the next 12 months, per Home.LLC: Provo, Utah; Lakeland and Cape Coral, in Florida; and Austin.
• The other side: "Most cities will see a deceleration in home prices — not a crash," Home.LLC founder Nik Shah tells Axios.