Home Prices Are Rebounding
You may feel a bit unsure about what’s happening with home prices and fear whether or not the worst is yet to come. That’s because today’s headlines are painting an unnecessarily negative picture. If we take a year-over-year view, home prices did drop some, but that’s because we’re comparing to a ‘unicorn’ year when prices peaked well beyond the norm.
To avoid an unfair comparison to that previous peak, we need to look at monthly data. And that tells a very different and much more positive story. While local home price trends still vary by market, here’s what the national data tells us.
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.
Looking at this monthly view, we can see the past year in the housing market can be divided into two parts. In the first half of 2022, home prices were going up, and fast. However, starting in July, prices began to go down (shown in red in the graphs above). By around August or September, the trend started to stabilize. But, looking at the most recent data for early 2023, these graphs also show that prices are going up again.
The fact that all three reports show prices have been going up for three or more straight months is an encouraging sign for the housing market. The month-over-month data indicates a national shift is happening – home prices are rising 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 one of the reasons prices didn’t crash like some expected is because there aren’t enough available homes for the number of people who want to buy them. Even with today’s mortgage rates, there are more people looking to buy than there are homes available for sale.
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
If you delayed your moving plans because you were concerned about home prices dropping, the latest data reveals the worst is already over, and prices are appreciating nationally. Partner with a local real estate agent so you know what’s happening with home prices in your area.
And these recent articles:
Marblehead Mid-year 2023 Market Stats
Swampscott Mid-year 2023 Market Stats
Salem Mid-year 2023 Market Stats
Economic and mortgage commentary
Two signs Inflation is Slowing
Federal Reserve increase rates; Mortgage Rates drop
What drives Mortgage rates in one chart
How Marblehead’s 2023 Property Tax Rate is Calculated
Essex County 2023 Property Tax Rates: Town by Town guide
Why Mortgage Rates Will Fall
Market Reports
Bidding Wars return to North Shore
June Inventory shows modest increases
Q1 2023 Market Stats
Marblehead 2022 Housing Market Review
Swampscott 2022 Housing Market Review
Beverly 2022 Housing Market Review
Salem 2022 Housing Market Review
Essex County 2022 Housing Market Review
July Inventory shows Sharp Drop
Essex County Town by Town Guide: 2022 Median Prices and Sales; 2023 Tax Rates
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, please contact me on 617.834.8205 or [email protected].
Andrew Oliver, M.B.E.,M.B.A.
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
m 617.834.8205
www.OliverReportsMA.com
“If you’re interested in Marblehead, you have to visit the blog of Mr. Andrew Oliver, author and curator of OliverReportsMA.com. He’s assembled the most comprehensive analysis of Essex County we know of with market data and trends going back decades. It’s a great starting point for those looking in the towns of Marblehead, Salem, Beverly, Lynn and Swampscott.”
__________________
Andrew Oliver, M.B.E., M.B.A.
Real Estate Advisor
[email protected]
www.AndrewOliverRealtor.com
www.OliverReportsFL.com
————
Compass
800 Laurel Oak Drive, Suite 400, Naples, FL 34108
m: 617.834.8205