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Where Home Prices Are Falling & Rising the Most.
I know this sounds like good new but San Jose, CA is not one of those cities where home prices are falling. In fact, San Jose is one of the top cities where it has accelerated and continues to do so.
Housing affordability is worsening because of high mortgage rates. Like I mentioned in Wednesdays post, mortgage rates makes things more expensive. This is prompting a slowdown to some sellers that can’t get what they want for their home. The U.S median home price rose 4.8% in the third quarter, the slowest rate of annual appreciation since the second quarter of 2016 according to ATTOM Data Solutions, a real estate data firm.
“The continued slowdown in the rate of home price appreciation nationwide and in many local markets is a rational response to worsening home affordability—which has deteriorated at an accelerated pace this year due to rising mortgage rates,” says Daren Blomquist, senior vice president at ATTOM Data Solutions. “Markets not experiencing this price appreciation cooldown may have more of an affordability cushion to work with, but some are in danger of overheating if home price gains continue to run hot.”
A year ago, 74 of the 150 metro areas like Los Angeles, Chicago, Dallas-Fort Worth, Houston, Miami had a single-digit percentage gain in median home prices. BUT just this year, those same metro areas have seen rates of home appreciation slow down.
People way smarter than me believe rising rates on the monthly payment is the key factor underpinning the decelerating price appreciation in which I totally agree with.
If financing is harder to get and rates keep climbing, it sort of weakens the buying power which then means houses sit on the market longer, prices decrease, and so on and so on.
The thing is, buyer demand is still high but affordability is still a problem. Even with the slight decrease in pricing, it’s still way too high for most buyers. So in turn buyers are falling out of the market or just moving down in price.
Where prices are still accelerating is no other place than your home city San Jose, CA. It has shown a double-digit percentage gain in median home prices compared to a year ago.
Other cities that have seen this gain are Boise, Idaho; Las Vegas; Grand Rapids, Mich.; Lakeland, Fla.; Colorado Springs, Colo.; Dayton, Ohio; San Francisco; and Atlanta.
As always thank you for reading I appreciate you and your time.
Your favorite Realtor gal