Navigating the current state of the housing market can be a confusing and daunting task, especially when it comes to home prices. The headlines are constantly changing and data can be misleading, leaving many homeowners and potential buyers wondering about the direction of the market. With spring just around the corner, it’s important to understand the current state of home prices and what it means for you.
National vs. Local Price Trends
While the national data on home prices may not show a significant change, local trends can vary widely by market. According to Nataliya Polkovnichenko, Ph.D., Supervisory Economist at the Federal Housing Finance Agency (FHFA), U.S. house prices have remained near peak levels reached over the summer of 2022. While demand has been suppressed by higher mortgage rates, low inventories of homes for sale have helped maintain relatively flat house prices.
When looking at month-over-month home price changes, it's evident that the started to change in summer 2022. For homeowners who are concerned about the decline in prices, it's important to keep in mind how much home values grew over the last few years. Compared to that growth, any declines we're seeing are generally more minimal.
Here in Sacramento, we've seen prices generally decline since last year but have begin to platue within the past few weeks. Low inventory has been a challenge as more home buyers enter the market with overall activity with viewing homes.
Minimal Decline in Prices
Chief Economist at CoreLogic, Selma Hepp, shares that while prices continued to fall from November, the rate of decline was lower than what some home buyers have expected. While a decline in prices can be worrisome for homeowners, it's important to keep in mind that the drop is relatively small compared to the significant growth in home prices over the last few years.
For potential buyers, this could be an opportunity to enter the market at a lower price point. In Sacramento home buyers have become more active in recent weeks with a slight decrease in interest rates and the spring market well on its way, I anticipate we will see more buyers taking advantage of the lower prices.
Work with a Local Real Estate Professional
Navigating the current housing market can be a challenging task, especially when it comes to understanding the current state of home prices. To avoid the confusion and the uncertainty, it's essential to work with a local real estate professional who can provide you with the latest information and insights on the market in your area.
As your local realtor, I can help put together a gameplan that makes sense and put together a strategy that will get your offer accepted for the best price possible. I can also help you understand the current state of mortgage rates, which can have a significant impact on your homebuying decisions and connect you with the best lenders in our area.
Bottom Line
As we gear up for the spring housing market, understanding the current state of home prices is crucial for both homeowners and potential buyers. While things remain stable, the market is ever changing and it's important to be ahead of the market. With the right knowledge and insights, you can make informed decisions and achieve your real estate goals.
Credit to Sacramento Appraisal Blog for their in depth graphs that we used above.