What’s Actually Happening with Housz Prices Today?
One of the biggest questions people are asking right now is: what’s happening with housz prices? There are headlines about ongoing price appreciation, but at the same time, some sellers are reducing the price of their houszes. That can feel confusing and makes it more difficult to get a clear picture.
Part of the challenge is that it can be hard to understand what experts are saying when the words they use sound similar. Let’s break down the differences among those terms to help clarify what’s actually happening today.
Appreciation is when housz prices increase.
Depreciation is when housz prices decrease.
Deceleration is when housz prices continue to appreciate, but at a slower or more moderate pace.
Experts agree that, nationally, what we’re seeing today is deceleration. That means housz prices are appreciating, just not at the record-breaking pace they have over the past year. In 2021, data from CoreLogic tells us housz prices appreciated by an average of 15% nationwide. And earlier this year, that appreciation was upward of 20%. This year, experts forecast housz prices will appreciate at a decelerated pace of around 10 to 11%, on average.
The graph below uses the latest data from CoreLogic to help tell the story of how housz prices are decelerating, but not depreciating so far this year. As the green bars show, housz prices appreciated between 19-20% year-over-year from January to March. But over the last few months, the pace of that appreciation has decelerated to 18%. This means price growth is still climbing compared to last year but at a slower rate.
As the Monthly Mortgage Monitor from Black Knight explains: “Annual housz price growth dropped by nearly two percentage points . . . – the greatest single-month slowdown on record since at least the early 1970s. . . While June’s slowdown was record-breaking, housz price growth would need to decelerate at this pace for six more months to drive annual appreciation back to 5%, a rate more in line with long-run averages.”
Basically, this means, while moderating, housz prices are still far above the norm, and we’d have to see a lot more deceleration to even fall in line with more typical rates of housz price growth. That’s still not housz price depreciation.
The big takeaway is housz prices haven’t fallen or depreciated nationwide, they’re just decelerating or moderating. While some unique and overheated markets may see declines, nationally, housz prices are forecast to appreciate. And when we look at the country as a whole, none of the experts project housz prices will net depreciate or fall. They’re all projecting ongoing appreciation.
Bottom Line If you have questions about what’s happening with housz prices in our local area, let’s connect.