Home Prices Are Rebounding

<article class="post-744563 post type-post status-publish format-standard has-post-thumbnail hentry" id="post-744563"><span class="entry-date">July 17, 2023</span><div class="entry-header center-block text-center"><h1 class="entry-title">Home Prices Are Rebounding</h1><div class="shareBlock"><div class="shareTitle">Share</div><div class="shareIcons"><a aria-label="Twitter Share Link" class="twitter solid display-inline-block" data-tracking="Post,Social Post Link Clicked,Twitter" href="http://twitter.com/share?text=Home+Prices+Are+Rebounding&amp;url=https%3A%2F%2Fgilliggroup.com%2Fblog%2Fhome-prices-are-rebounding%2F" target="_blank"><span class="force-hidden">Twitter</span></a>
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</div></div><div class="post-tax post-category"><span></span><a href="../category/realtor-blog/index.html" rel="tag">Realtor Blog</a></div><div class="post-tax post-post_tag"></div></div><div class="entry-content"><div><img alt="Home Prices Are Rebounding Simplifying The Market" decoding="async" loading="lazy" src="https://media.agentaprd.com/sites/222/20230717-home-prices-are-rebounding.webp" style="display: block; margin-bottom: 5px; clear: both; max-width: 100%;" width="358"/>
<p><span style="color: black;">If you’re following the news today, you may feel a bit unsure about what’s happening with </span><a href="https://www.simplifyingthemarket.com/2023/04/17/think-twice-before-waiting-for-lower-home-prices/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">home prices</a><span style="color: black;"> and fear whether or not the worst is yet to come. That’s because today’s headlines are painting an </span><a href="https://www.simplifyingthemarket.com/2023/05/09/why-todays-housing-market-is-not-about-to-crash/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">unnecessarily negative</a><span style="color: black;"> picture. If we take a year-over-year view, home prices did </span><a href="https://spglobal.com/spdji/en/index-announcements/article/sp-corelogic-case-shiller-index-continued-gains-in-april/" rel="noopener noreferrer" target="_blank">drop</a><span style="color: black;"> some, but that’s because we’re comparing to a </span><a href="https://www.simplifyingthemarket.com/2023/05/30/todays-real-estate-market-the-unicorns-have-galloped-off/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">‘unicorn’ year</a><span style="color: black;"> when prices peaked well beyond the norm.</span></p>
<p><span style="color: black;">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.</span></p>
<p><strong style="color: black;">The </strong><a href="https://www.spglobal.com/spdji/en/indices/indicators/sp-corelogic-case-shiller-us-national-home-price-nsa-index/#news-research" rel="noopener noreferrer" target="_blank"><strong>graphs</strong></a><strong style="color: black;"> below use </strong><strong>recent monthly</strong><strong style="color: red;"> </strong><a href="https://www.fhfa.gov/DataTools/Downloads/Pages/House-Price-Index.aspx" rel="noopener noreferrer" target="_blank"><strong>reports</strong></a><strong style="color: black;"> from three </strong><a href="https://www.corelogic.com/category/intelligence/reports/home-price-insights/" rel="noopener noreferrer" target="_blank"><strong>sources</strong></a><strong style="color: black;"> to show the worst home price declines are already behind us, and prices are appreciating nationally. </strong></p>
<p> <a href="https://www.simplifyingthemarket.com/content/images/20230712/20230717-Percent-change-in-home-values.png?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank"><img decoding="async" src="https://files.keepingcurrentmatters.com/content/images/20230712/20230717-Percent-change-in-home-values.png"/></a></p>
<p>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 (<em>shown in red in the graphs above</em>). 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.</p>
<p>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 – <strong>home prices are rising again</strong>.</p>
<p><span style="color: black;">Craig J. Lazzara, Managing Director at</span><em style="color: black;"> S&amp;P Dow Jones Indices</em><span style="color: black;">, </span><a href="https://www.spglobal.com/spdji/en/documents/indexnews/announcements/20230627-1464869/1464869_cshomeprice-release-0627.pdf" rel="noopener noreferrer" target="_blank">says</a><span style="color: black;"> this about home price trends: </span></p>
<blockquote><p><em style="color: black;">“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.”</em><span style="color: black;"> </span></p></blockquote>
<p><span style="color: black;">Experts believe one of the reasons prices didn’t crash like some expected is because there aren’t enough available </span><a href="https://www.simplifyingthemarket.com/2023/07/06/todays-housing-inventory-is-a-sweet-spot-for-sellers/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">homes</a><span style="color: black;"> for the number of people who want to buy them. Even with today’s </span><a href="https://www.simplifyingthemarket.com/2023/06/13/your-needs-matter-more-than-todays-mortgage-rates/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">mortgage rates</a><span style="color: black;">, there are more people looking to buy than there are homes available for sale.</span></p>
<p><span style="color: black;">Mark Fleming, Chief Economist a</span>t <em>First American</em>,<span style="color: black;"> </span><a href="https://blog.firstam.com/economics/why-higher-mortgage-rates-dont-always-lead-to-declining-house-prices" rel="noopener noreferrer" style="color: rgb(5, 99, 193);" target="_blank">explains</a><span style="color: black;"> how more demand than supply keeps upward pressure on prices:</span></p>
<blockquote><p><em style="color: black;">“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 </em><strong style="color: black;"><em>demand for homes continues to outpace supply, keeping the pressure on house prices</em></strong><em style="color: black;">.”</em></p></blockquote>
<p>Doug Duncan, Senior VP and Chief Economist at <em>Fannie Mae</em>, <a href="https://www.fanniemae.com/newsroom/fannie-mae-news/mixed-data-complicates-economic-forecast-though-recession-remains-likely" rel="noopener noreferrer" target="_blank">states</a> home price growth is exceeding expectations thanks to that high demand:</p>
<blockquote><p><em>“. . .</em><strong><em> housing prices continue to show stronger growth than what was previously expected</em></strong><em> . . . Housing’s performance is a testimony to the strength of demographic-related demand . . .”</em></p></blockquote>
<h4><strong>Here’s How This Affects You</strong></h4>
<ul>
<li><strong>Buyers</strong>: If you’ve been holding off on <a href="https://www.simplifyingthemarket.com/2023/07/05/two-questions-to-ask-yourself-if-youre-considering-buying-a-home/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">buying</a> 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 <a href="https://www.simplifyingthemarket.com/2023/06/16/how-owning-a-home-grows-your-wealth-with-time-infographic/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">own</a> something that usually becomes more <a href="https://www.simplifyingthemarket.com/2023/06/27/why-homeownership-wins-in-the-long-run/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">valuable</a> as time goes on.</li>
<li><strong>Sellers</strong>: If you’ve been waiting to <a href="https://www.simplifyingthemarket.com/2023/06/29/where-will-you-go-if-you-sell-newly-built-homes-might-be-the-answer/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">sell</a> 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 <a href="https://www.simplifyingthemarket.com/2023/06/30/key-reasons-to-use-a-real-estate-agent-when-you-sell-infographic/?a=712984-fa409495d5d70154d03a25e81e9540e2" rel="noopener noreferrer" target="_blank">real estate agent</a> to list your house. You don’t have to wait any longer because the latest data suggests things are turning in your favor.</li>
</ul>
<h3>Bottom Line</h3>
<p>If you delayed your moving plans because you were concerned about home prices dropping, the latest data reveals the worst is already over, and <a href="https://www.simplifyingthemarket.com/2023/06/20/why-the-median-home-price-is-meaningless-in-todays-market/" rel="noopener noreferrer" target="_blank">prices</a> are appreciating nationally. Partner with a local real estate agent so you know what’s happening with home prices in your area.</p>
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