Home prices showed only a 4% to 5% appreciation over 2024, with a further slowdown in sales momentum and prices noted in early 2023. The median pending home price is $386,000, reflecting a mere 2% increase from the previous year, which is unusual compared to the typical 5%. Inventory levels have risen 29% year-over-year, suggesting long-term market shifts influenced by elevated mortgage rates at around 7%. While southern markets face potential declines, northeast areas may see price appreciation due to tight inventory.
Home price appreciation is waning, with current prices showing a modest increase of 2%, indicating weak demand and flat market conditions.
Most years see about 5% home price appreciation, but this year home prices appear virtually flat and unchanged compared to last year.
The sunbelt markets are experiencing more inventory and potential price declines, while tight inventory in the northeast is likely to support price increases.
There are 29% more unsold single-family homes on the market now compared to last year, suggesting a shift in inventory dynamics.
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