These 10 U.S. real estate markets are cooling the fastest: Here’s what to know if you’re a prospective buyer

The US housing market is starting to cool, and it is happening fastest on the West Coast.

San Jose, California, is the fastest-cooling real estate market in the US, according to a new Redliff analysis.

The Bay Area is home to three of the top 10 markets.

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The fastest-cooling housing market was Albany, New York, followed by El Paso, Texas.

The affordability factor is one of the top reasons for cooling due to rising interest rates.

Northern California, where homes may easily sell for $1 million to 1.5 million or higher, have been harder hit by 30-year fixed mortgage rates than other areas.

If you buy a million-dollar home with a 20% down payment, your monthly mortgage payment may be around $5,750 with a 6% interest rate, which is more than a 3% interest rate, according to the report.

The U.S. markets that have cooled the most over the past year are listed here.

1. San Jose, California — $1,560,000
2. Sacramento, California — $610,000
3. Oakland, California — $1,070,000
4. Seattle, Washington — $850,000
5. Stockton, California — $576,000
6. Boise, Idaho — $550,000
7. Denver, Colorado — $612,000
8. San Diego, California — $875,000
9. Tacoma, Washington — $575,000
10. San Francisco, California — $1,620,000

The U.S. markets that have been the fastest to cool over the past year are listed here.

1. Albany, New York — $289,000
2. El Paso, Texas — $238,000
3. Bridgeport, Connecticut — $570,000
4. Lake County, Illinois — $324,400
5. Rochester, New York — $212,100
6. New Brunswick, New Jersey — $465,000
7. Cincinnati, Ohio — $265,000
8. Akron, Ohio — $200,000
9. New Haven, Connecticut — $310,000
10. Virginia Beach, Virginia — $325,000

Experts don't expect significant price drops in most markets, even though growth may be slowing.

Lack of inventory is one of the reasons why the market is frothy.

There has been more inventory on the market in some of the faster cooling markets. Inventory is up in Seattle.

Home prices are not rising as fast as they used to. According to the Federal Reserve Bank of New York's Survey of Consumer Expectations, the one-year median home price growth fell to 4.4% from 5.6% in June.

The pace of price increases will diminish significantly, according to Cohn.

One of the reason why we’ve had this frothy, overheated market is just lack of inventory.

Over the past couple of years, a lot of buyers have paid cash, so they have not had to pay for an appraisal, inspection or even see the home in person.

The market shift could give buyers more time to see properties, make an offer and purchase the right home.

You may have concerns about the future value of your home if you recently purchased it.

Matthew Chancey said that the payments should be more manageable than someone buying now because the buyers most likely got locked into a lower interest rate.

He said that if you overbid on the property, you could be underwater in the short term.

You don't need to rush to fix that situation. The owner of a wealth management company said that underwater homeowners should put their extra cash into savings for emergencies rather than trying to pay down their mortgage.

Three to six months of living expenses are recommended by experts. Some advisors would like to add more flexibility.