The recent changes in home prices are top of mind for many as the housing market begins gearing up for spring. It can be hard to navigate misleading headlines and confusing data, so here’s what you should know about today’s home prices.
Local price trends still vary by market. But looking at national data, Nataliya Polkovnichenko, Ph.D., Supervisory Economist at the Federal Housing Finance Agency (FHFA), explains:
“U.S. house prices were largely unchanged in the last four months and remained near the peak levels reached over the summer of 2022. While higher mortgage rates have suppressed demand, low inventories of homes for sale have helped maintain relatively flat house prices.”
Month-over-month home price changes can be seen in the chart below. The data also shows that price depreciation peaked around August. Since then, any depreciation has been even milder. In other words, today’s home prices aren’t in a freefall.
What Does This Mean for You?
If you currently own your house, you may be concerned about even the smallest decline in prices. But keep in mind how much home values grew over the last few years. Compared to that growth, any declines we’re seeing nationally are likely to be minimal. Selma Hepp, Chief Economist at CoreLogic, shares:
“. . . while prices continued to fall from November, the rate of decline was lower than that seen in the summer and still adds up to only a 3% cumulative drop in prices since last spring’s peak.”
It’s also important to remember that every local market is different. That’s why it’s essential to lean on an expert for the latest information on the home prices in your area if you’re planning to make a move this spring.
To understand what’s going on with home prices in our market and how they could impact your goals, let’s connect today.
If you’re thinking about buying or selling a home this year, you may have questions about what’s happening with home prices today as the market cools. In the simplest sense, nationally, experts don’t expect prices to come crashing down, but the level of Boston condo price moderation will depend on factors like supply and demand in each Boston MA neighborhood.
That means, moving forward, Condominium price appreciation will continue to vary by location, with more significant changes happening in overheated areas. Here’s a quick snapshot of what the experts are saying:
Danielle Hale, Chief Economist at realtor.com, says:
“The major question on the minds of homeowners and aspiring buyers alike is what will happen to home prices. . . Soaring prices were propelled by all-time low mortgage rates which are a thing of the past. As a result, home price growth is expected to continue slowing, dipping below its pre-pandemic average to 5.4% for 2023, as a whole.”
Mark Fleming, Chief Economist at First American, says:
“House price appreciation has slowed in all 50 markets we track, but the deceleration is generally more dramatic in areas that experienced the strongest peak appreciation rates.”
Taylor Marr, Deputy Chief Economist at Redfin, says:
“For those bearish folks eagerly awaiting the home price crash, you’ll have to keep waiting. As much as demand is pulling back supply is as well reducing downward pressure on prices in the short run.”
John Paulson, Founder of Paulson & Co., says:
“It’s true – housing may be a little frothy. So housing prices may come down or they may plateau . . .”
What Does This Mean for You?
The best way to get the answers you need is to contact us at Ford Realty Inc (617-595-3712). We’ll be able to explain the latest trends in your specific market so you can make a confident and informed decision on your next step toward buying or selling a home.
Boston Condos and the Bottom Line
If you have questions about what’s happening with Boston condo for sale prices today, let’s connect so you have the latest on our local market.
Boston‘s housing market remained hot in October, with the price of homes inching up 0.1% from September and 15.1% from a year before, according to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index.
Nationally, housing prices were also on the rise, according to the index, which registered an 0.8% seasonally adjusted gain from September and a 19.1% year-over-year increase.
After seasonal adjustment, the 10-city and 20-city composite indexes posted increases of 0.8% and 0.9%, respectively.
“We continue to see very strong growth at the city level,” S&P DJI managing director Craig Lazzara said in a press release. “All 20 cities saw price increases in the year ended October 2021. October’s increase ranked in the top quintile of historical experience for 19 cities, and in the top decile for 17 of them.”
Lazzara noted that despite the broad-based increases, the pace of rising prices slowed in 14 of the 20 cities compared to September.
Phoenix, followed by Tampa, Fla., and Miami claimed the largest price gains among the 20 metro areas in the index.
“We have previously suggested that the strength in the U.S. housing market is being driven in part by a change in locational preferences as households react to the COVID pandemic,” Lazzara said. “More data will be required to understand whether this demand surge represents an acceleration of purchases that would have occurred over the next several years, or reflects a more permanent secular change.”
Ford Realty Inc., Boston Real Estate for Sale[/caption]
What’s happening with Boston condo prices?
The median price of a home in the U.S. reached its highest point in 13 years last month as inventory continued to fall, according to the RE/MAX National Housing Report for February.
The national median of $291,000 represented a record high for February, though it was far lower than the Boston area’s median of $537,500. Boston’s median price decreased 0.3% month over month, from $539,000 in January. The metro area’s median prices increased 10.6% year over year from $486,000 in February 2020. Nationally, February home prices were up 5.7% year over year.
There were 2,359 real estate transactions in Boston in February. That figure represents a 23.6% decrease from 3,086 in January and is 0.4% lower than the 2,265 transactions recorded in February 2020. Boston’s active inventory fell by 0.3% month over month, from 5,522 in January to 4,704 in February. Inventory was down 44.4% year over year, from 8,460 last February.
Nationally, the month’s supply of inventory was down 11.9% from January and 42% year over year. Month over month inventory has fallen for 20 of the past 21 months, according to the report.
Boston-area homes took an average of 50 days to sell in February, a month-over-month increase from 42 days in January. Year over year, the number of days homes spent on the market fell by 26.5% from 68 days in February 2020. Boston’s days on the market average for last month were higher than the national average of 42 days. Nationally, homes sold an average of 18 days faster than last February.
Boston condo for sale values has softened over the last twelve months. We are no longer seeing 6-7% annual appreciation levels of the past
However, a stronger-than-expected economy and a good spring housing market have changed some opinions. Some analysts are now predicting that home value appreciation may begin to increase as we move forward.
Here are three examples:
“Data on the movement of unadjusted house prices during the early spring home-buying season won’t be available for a few more months, but it’s quite likely that price appreciation will accelerate again.”
“Home prices nationwide, including distressed sales, increased year over year by 3.7% in March 2019 compared with March 2018…The CoreLogic HPI Forecast indicates that home prices will increase by 4.8% on a year-over-year basis from March 2019 to March 2020.”
Boston condo price appreciation has slowed over the past year. However, a strong economy and a good housing market have many experts thinking that home values might re-accelerate moderately throughout the rest of this year.
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