If you're keeping up with the news, you might be feeling uncertain about the state of home prices and worrying if the worst is yet to come. However, it's important to separate fact from sensationalism. Contrary to alarming headlines, home prices are not in a freefall. In fact, the latest data tells a much more positive story. While local markets still exhibit variations, let's delve into the national data to gain a clearer understanding.
When we take a year-over-year view, home prices have remained positive, albeit appreciating more slowly than during the peak of the pandemic. To obtain a more detailed picture, let's examine the monthly data.
The following graphs utilize recent reports from three reliable sources, revealing that the most severe declines in home prices are already behind us. Instead, prices are on their way back up nationally, indicating a rebound.
Analyzing the monthly trends, the past year has been a tale of two halves in the housing market. In the first half of 2022, home prices were climbing steadily, reaching their peak in June. However, starting in July, home prices began to decline (depicted in red on the graphs). By August or September, the trend began stabilizing. The most recent data for the early part of 2023 shows a recent rebound in momentum, with prices starting to rise again. As we enter the busy spring season, monthly changes in home prices are gaining momentum.
While it's important to note that one to two months do not establish a definitive trend, the fact that all three reports indicate price stabilization is an encouraging sign for the housing market. The month-over-month data conveys a clear consensus, albeit still early, that a national shift is taking place today. In essence, home prices are starting to tick back up.
Andy Walden, Vice President of Enterprise Research at Black Knight, provides insight into home price trends:
"Just five months ago, prices were declining on a seasonally adjusted month-over-month basis in 92% of all major U.S. markets. Fast forward to March, and the situation has done a literal 180, with prices now rising in 92% of markets from February."
Selma Hepp, Chief Economist at CoreLogic, explains that the limited supply of homes available for sale contributes to this positive turn:
"...prices in many large metros appeared to have turned the corner, with the U.S. recording a second consecutive month of gains... The rebound in home prices underscores the lack of inventory in this housing cycle."
What Does This Mean for Buyers and Sellers?
Sellers: If you've been holding off on selling due to concerns about declining home prices and the potential impact on your home's value, it may be time to reevaluate. Partnering with a knowledgeable real estate agent to list your house can help you navigate the current market conditions. The latest data shows a turn in your favor, allowing you to move forward without unnecessary delay.
Buyers: If you've been hesitant to purchase a home due to fears of declining value, now is an opportune time to reconsider. The improving market conditions provide peace of mind that things are looking up. Buying now allows you to make a move before home prices climb further, giving you the chance to own an asset that typically appreciates over time.
In summary, if you put off your plans to move because you were worried about home prices falling, data shows the worst is already behind us and prices are actually rising nationally. To gain a better understanding of the current trends in home prices specific to our area, it's advisable to connect with an expert like Anthony Spitaleri and his team. With their extensive knowledge of the local market, they can provide valuable insights and explain what we're seeing with home prices. Don't miss out on the opportunity to make informed decisions about your move. Reach out to us today for expert guidance tailored to your specific housing needs.
