Home Prices Rising: Get Informed Now!
Today’s news may leave you feeling uncertain about home prices, fearing the worst. But this outlook is overly negative. Looking at year-over-year changes, we see that while prices have dropped they are still within normal ranges. The only exception was a ‘unicorn’ year when they peaked significantly higher than usual.
For an accurate comparison, we should look at monthly data instead of peak figures. That way, we can see a more positive national trend. Local market trends may differ, but here are some key points revealed by the national data.
The graphs below use recent monthly reports from three sources to show the worst home price declines are already behind us, and prices are appreciating nationally.
Home prices in the housing market for 2022 can be divided into two parts. In the first half, they increased quickly. Starting in July, prices began to drop (shown in red). This trend stabilized in August or September. More recently, however, data shows that prices are rising again.
The housing market is looking promising as all three reports reveal that home prices have been increasing for at least three months in a row. The month-over-month data suggests that there has been a national trend toward rising house prices again.
Craig J. Lazzara, Managing Director at S&P Dow Jones Indices, says this about home price trends:
“If I were trying to make a case that the decline in home prices that began in June 2022 had definitively ended in January 2023, April’s data would bolster my argument.”
Experts believe prices didn’t crash as expected due to the shortage of homes for sale. Mortgage rates are steady, yet more people want to buy than there are properties available.
Mark Fleming, Chief Economist at First American, explains how more demand than supply keeps upward pressure on prices:
“History has shown that higher rates may take the steam out of rising prices, but it doesn’t cause them to collapse entirely. This is especially true in today’s housing market, where the demand for homes continues to outpace supply, keeping the pressure on house prices.”
Doug Duncan, Senior VP and Chief Economist at Fannie Mae, states home price growth is exceeding expectations thanks to that high demand:
“. . . housing prices continue to show stronger growth than what was previously expected . . . Housing’s performance is a testimony to the strength of demographic-related demand . . .”
Here’s How This Affects You
- Buyers: If you’ve been holding off on buying because you were worried the value of your home would go down, knowing home prices have bounced back should bring you some relief. It also gives you the opportunity to own something that usually becomes more valuable as time goes on.
- Sellers: If you’ve been waiting to sell your house because you were concerned about how changing home prices would affect its value, it might be a good idea to team up with a real estate agent to list your house. You don’t have to wait any longer because the latest data suggests things are turning in your favor.
Bottom Line
The latest data on home prices shows that the worst of the declines are over, and prices are on the rise. To make sure you’re getting the best deal when buying or selling a home, it’s important to keep up with these trends and partner with a real estate agent who can give you their insight. Homeownership is an investment that has proven to be rewarding and enduring, so don’t let worrying about home prices stop you from taking the plunge! By understanding the market and working with an experienced agent, you can make sure your home purchase or sale is a smart decision. Let’s get in touch and discuss further to determine how best to take advantage of this trend.