Home Prices Are Rebounding!
You might feel uncertain about the current state of home prices and harboring concerns about whether things will take a turn for the worse. The headlines today, however, are needlessly portraying a negative scenario. To understand the situation better, it’s important to take a broader perspective by comparing home prices year-over-year. Although there has been a decline in home prices, this can be attributed to an extraordinary period when prices reached an unusually high level.
Percent Change in Home Values
Examining the monthly perspective, it becomes evident that the housing market’s performance over the past year can be divided into two distinct periods. During the first half of 2022, home prices experienced a rapid and upward trajectory. However, a shift occurred in July, marked by a decline in prices. The trend began to stabilize around August or September. Yet, the most recent data for early 2023 depicted in these graphs demonstrates a renewed upward movement in prices.
“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.” – Craig J. Lazzara, Managing Director at S&P Dow Jones Indices
The positive aspect to note is that all three reports consistently indicate a continuous increase in home prices for three or more consecutive months. This encouraging trend serves as a promising indication for the housing market. The month-over-month data strongly suggests a notable nationwide shift is occurring, with home prices once again on the rise.
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.
Buyers:
If you have been hesitant to make a home purchase due to concerns about potential depreciation in property value, the rebound in home prices should alleviate some of your worries. Moreover, it presents an opportunity to acquire a valuable asset that typically appreciates over time.
Sellers:
If you have been delaying the sale of your house out of apprehension regarding fluctuating home prices and their impact on its value, it could be advantageous to collaborate with a real estate agent and list your property. With the latest data indicating a shift in the market, you no longer need to wait, as conditions seem to be turning in your favor.
