Home prices increased by 1.0% quarter-over-quarter in Q1 2023.
Single-family home prices rose by 4.7% year-over-year in the first quarter of 2023, according to the latest Home Price Index reading by Fannie Mae. On a quarter-by-quarter basis, home prices increased by 1.0% in Q1 2023, Fannie Mae reported.
However, annual home price growth was down from the previous quarter's revised annual growth rate of 8.6%, according to Fannie Mae.
"As expected, the annual rate of increase in home prices has slowed dramatically in response to the rapid and significant increase in interest rates," Doug Duncan, Fannie Mae's senior vice president and chief economist, said in a statement. "Still, the fact that prices rose slightly in the first quarter is evidence of significant pent-up mortgage demand, despite ongoing affordability constraints. Even though mortgage rates remain elevated compared to the previous few years, the acute lack of housing supply remains supportive of home prices."
Furthermore, the lack of available housing may also be tied to the "lock-in effect," Fannie Mae said. This concept suggests that people who locked into historically low mortgage rates at the onset of the COVID-19 pandemic may be hesitant to list their homes.
"People are reluctant to sell because they don’t want to give up their low mortgage rate, real estate broker Redfin said in a recent report. "It’s hard to find another home to buy and many Americans recently moved."
If you’re looking to save on buying a home, it can help to shop around for mortgages. You can visit Credible to compare options from different lenders, without affecting your credit score.
HOME PRICES COULD DROP THROUGH 2023: ZILLOW
U.S. home listings continue on a downward trajectory
New listings of U.S. homes for sale have decreased 25% from a year prior, during the four weeks ending April 9, according to the latest housing market update by Redfin. That drop marked an eight-month trend of double-digit declines. It also represented the most significant plunge since the dawn of the COVID-19 pandemic, Redfin reported.
In fact, new listings have declined year-over-year in all 50 of the most populous U.S. metro areas, Redfin found. The largest declines were seen in California. Here’s where the steepest year-over-year listing declines have been found, based on Redfin’s market update.
- Sacramento and Oakland (-47% each)
- San Francisco (-43.2%)
- San Jose, Calif. (-42.9%)
- San Diego (-41.4%)
In addition, pending home sales have dropped in all 50 of the most populous U.S. metro areas, Redfin found. Here are the areas that have seen the largest sales dips.
- Las Vegas (-45.7%)
- San Jose, Calif. (-42.9%)
- Seattle (-42.4%)
- Portland(-41.9%)
- Oakland (-41.1%)
But while higher mortgage rates may deter some from homebuying, some potential buyers are struggling with finding the right home for sale, Redfin reported.
"Many buyers here aren’t held back by high mortgage rates; it’s the lack of inventory that’s really getting in their way," San Jose Redfin agent Angela Langone said in a statement. "I have several clients who are serious about buying a home and they’re actively looking, but they can’t find anything right now and they’re waiting for more homes to trickle onto the market."
If you want to save money in the homebuying process, you may benefit by shopping around to find the best mortgage rate. You can visit Credible to get your personalized rate in minutes.
FED FORGES AHEAD WITH 25 BASIS POINT INTEREST RATE INCREASE, SIGNALING RESOLVE TO BATTLE INFLATION
Mortgage rates projected to drop
Despite evidence of high mortgage rates in recent months, some experts said they believe rates could follow a downward trend soon.
In fact, 63% of economists and housing experts on a Zillow panel said they expected that in the upcoming three years, 30-year fixed rate mortgages would have peaked in Q1 2023.
"Falling rates are far more helpful for affordability than falling home prices, at least at the scale of recent movements," Zillow said in its report.
But a slight drop in mortgage rates, at least for the time being, may not be enough to get some sellers over the lock-in effect, Redfin reported.
"Two new pieces of economic data serve as tea leaves we can read to anticipate how mortgage rates will trend over the next few months," Redfin said in its report. "It’s unlikely they’ll skyrocket, but it’s also unlikely they’ll come down enough to motivate locked-in homeowners to sell. The March consumer-price index and jobs report showed that inflation continued to cool and wage growth ticked down from the month before, but inflation is still higher than the Fed’s target."
In addition, the scarcity of available housing could still pose another obstacle to would-be homeowners, Redfin said.
"The Fed has made some progress cooling inflation with rate hikes but there’s still work to be done," Redfin Chief Economist Daryl Fairweather said in a statement. "Even if the Fed chooses not to hike rates next month, which would likely bring down mortgage rates, the limited supply of homes for sale would remain a major obstacle for would-be buyers. Rates dipping below 6% would probably pique the interest of more buyers, but enough homeowners have rates in the 3% or 4% range that we’re unlikely to see a big uptick in new listings."
If you’re trying to find the most suitable mortgage rate, it can help to shop around. You can visit the Credible marketplace, where you can compare options and speak with a mortgage expert to get your questions answered.
FINAL FOURTH QUARTER GDP ESTIMATE CONFIRMS SLOWDOWN IN ECONOMIC GROWTH
Have a finance-related question, but don't know who to ask? Email The Credible Money Expert at moneyexpert@credible.com and your question might be answered by Credible in our Money Expert column.
from "price" - Google News https://ift.tt/VIuCgc1
via IFTTT
No comments:
Post a Comment