Home Prices Are Decelerating Not Falling
It's no secret that we're in one heck of a sizzling housing market, with prices reaching new heights in many parts of the country. It's a go-go seller's paradise of historic proportions, with hordes of stressed home buyers duking it out to find affordable—and available—places they can call their own.
It may seem like nothing can slow down those runaway prices for everything from high-rise condos in the biggest cities to cookie-cutter, single-family homes in the suburbs.
But here's the news: There are exceptions to every rule.There are actually a few metropolitan areas in the U.S. where prices are coming down.
Housing affordability is worsening due to higher mortgage rates, which is prompting a slowdown for what home sellers are able to get for their home.
The U.S. median home price rose 4.8 percent in the third quarter, the slowest rate of annual appreciation since the second quarter of 2016, according to a new report released by ATTOM Data Solutions, a real estate data firm.
“The continued slowdown in the rate of home price appreciation nationwide and in many local markets is a rational response to worsening home affordability—which has deteriorated at an accelerated pace this year due to rising mortgage rates,” says Daren Blomquist, senior vice president at ATTOM Data Solutions.
“Markets not experiencing this price appreciation cool down may have more of an affordability cushion to work with, but some are in danger of overheating if home price gains continue to run hot.”
Rates of home appreciation slowed in 74 of the 150 metro areas that ATTOM tracks, including Los Angeles, Chicago, Dallas-Fort Worth, Houston, and Miami—which all posted single-digit percentage gains in median home prices compared to a year ago.
“I think the key factor underpinning the decelerating price appreciation is the impact of rising rates on the monthly payment,” says Tendayi Kapfidze, chief economist at mortgage marketplace. “Absent financing structures that allow a borrower to increase leverage while mitigating an increase in the monthly debt service, buying power is decreasing across the board. This especially affects the marginal buyer who doesn’t have a lot of wiggle room.”
Kapfidze says buyer demand may still be high, but some potential buyers are falling out of the market and others are moving down in price due to the worsening in affordability conditions.
Counter to the national trend, home price appreciation is still accelerating in 76 of the 150 metro areas that ATTOM tracked. For example, the following markets all posted double-digit percentage gains in median home prices compared to a year ago: San Jose, Calif.; Boise, Idaho; Las Vegas; Grand Rapids, Mich.; Lakeland, Fla.; Colorado Springs, Colo.; Dayton, Ohio; San Francisco; and Atlanta.
We are Ready to Help! When you’re working with real estate professionals like Carriene Porter of Precision Realty & Associates, you’re guaranteed to get the expertise and advice you need.
Not quite ready to buy a home? You may qualify for the Lease with a Right to Purchase program. Call me and I'll give you the details on how you may qualify to get into the home you want, get settled and then purchase it when you are ready! If you prefer a more personal touch, CALL 801-809-9866 today.
#LeasePurchase #UtahRealEstate #Homeownership
“U.S. Median Home Price Increases 4.8 Percent in Q3 2018, Slowest Rate of Annual Appreciation Since Q2 2016,” ATTOM Data Solutions (Oct. 23, 2018)
Blog Archive2018-12-05 08:02:12
In 2019 Mortgage Payments to Jump 8.4%
Financing for Manufactured Homes Coming
Tale of Dual Markets
Need to Sell Your Home this Winter?
Buyers Pull Away From New-Home Market
Mortgage Loan Limits to Rise in 2019
Home Buyers and Sellers Should Watch in 2019
Townhouse Construction is Expected to Increase
Cities With Oldest, Youngest Homeowners
Overall, December is the Best Time to Buy a Home
Sluggish Home Sales came to an end in October
How to Pet-Proof Your House for the Holiday Guests
10 Great U.S. Ski Towns
A Way to Keep Aging Parents Close to Home
Huge Mistake to Take Your Home Off the Market for the Holidays
Best Mortgage Advice I've Heard, Ever
Tips to Help You Avoid a Rental Scam
Buying a Home?
Mortgage Rates Rise this Week
Cheaper the Home
Building Credit History From Scratch
How to Get a Mortgage Without Freaking Out
Home Prices Are Decelerating Not Falling
First-time Homebuyers Transition from Renting
Click here to see ALL articles.