H
ome Prices: What You Need to Know

    Home prices have been steadily rising for a while now, but things are starting to change. While prices are still increasing compared to last year, the growth is slower than before. According to CoreLogic, home prices across the U.S. went up by 4.3% in July 2024 compared to July 2023. This might seem like a lot, but it's actually slower growth than we've seen recently.

    Why the Slowdown?

    The main reason for this slowdown is interest rates. They have been increasing, making it more expensive for people to borrow money to buy a home. This has made some buyers hesitant, leading to fewer sales. However, there is a glimmer of hope! The Federal Reserve (the big guys who control interest rates) might lower them soon. This could make buying a home more affordable and give the market a little boost.

    Dr. Selma Hepp, Chief Economist for CoreLogic, explains: “Housing demand continued to struggle under the pressure of high mortgage rates and unaffordable home prices, leading to a significant slowdown in home price gains during the summer.”

    What About the Future?

    CoreLogic predicts that home prices will likely rise by just 0.2% from July 2024 to August 2024. Looking further ahead, they predict an increase of 2.2% between July 2024 and July 2025. These are just predictions, though, and things could change.

    Here’s a quick look at the national forecast:

    - July 2024 to August 2024: Home prices expected to rise by 0.2%.

    - July 2024 to July 2025: Home prices expected to rise by 2.2%.

    Regional Differences

    It's important to remember that the housing market isn't the same everywhere. Some places are hot, while others are cooling down. Here are some interesting regional data:

    - States with the highest year-over-year home price increases (July 2023 to July 2024):

     - Rhode Island: 10.6%

     - New Jersey: 9.7%

     - Connecticut: 8.3%

     - South Dakota: 8.1%

     - Illinois: 7.5%

    - Metro area with the highest year-over-year home price increase (July 2023 to July 2024):

     - Miami: 9.1% increase

     - Chicago: 7.2% rise

     - Las Vegas: 7.0% growth

     - Boston: 5.5% uptick

     - Washington D.C.: 5.0% increase

     - San Diego: 6.2% jump

     - Los Angeles: 4.0% increase

     - Phoenix: 3.5% growth

     - Houston: 2.0% rise

     - Denver: 1.4% increase

    Markets at high risk of home price declines:

    - Gainesville, FL

    - Palm Bay-Melbourne-Titusville, FL

    - Atlanta-Sandy Springs-Roswell, GA

    - Lakeland-Winter Haven, FL

    - Ogden-Clearfield, UT

    What Does It All Mean?

    The housing market can be confusing, but understanding the basics can help you make informed decisions. Here are a few key takeaways:

    - The market is cooling down: Home price growth is slowing, and sales are down.

    - Interest rates are a big factor: High rates make buying more expensive, which impacts demand.

    - Location matters: Some areas are seeing strong price growth, while others are at risk of declines.

    Keep an Eye Out for…

    - Changes in interest rates: Lower rates could stimulate the market.

    - The economy: A strong economy usually means a strong housing market.

    - Inventory levels: More homes for sale could ease price pressure.