Housing prices in the United States closed the year with a slight fall of 0.2% in the comparison from November to December of last year; however, in some cities, costs fell to almost 5%according to new data from Zillow.
A recent report by Zillow, a company specializing in the real estate market, showed that house prices in the country have begun to cool after reaching all-time highs throughout 2022.
According to their data, there are at least 7 markets or cities in the country where prices closed in 2022 and began 2023 with the biggest drops in the national real estate market.
According to Zillow’s analysis, the downward behavior of house prices in some markets is due to the fact that, finally, interest rate hikes have begun to drive away buyers.
The Federal Reserve (Fed) undertook seven adjustments to its key interest rate last year as a strategy to control the incessant inflation, which in December stood at a still out of range 6.5% in its annual measurement.
Fed adjustments shot up mortgage rates that even came to exceed 7% per year during the past yearwhich, along with soaring home prices, destroyed affordability, shutting out many buyers.
However, after several months of increases and with mortgage rates skyrocketing, finally the demand for housing in the country has begun to cool and with this, prices have begun to see a slight setback.
These are the 7 markets in which home prices fell the most at the end of 2022, according to Zillow data.
1. Seattle, Washington: -4.81%
2. Dallas, Texas: -1.47%
3. San Antonio, Texas: -1.33%
4. San Diego, California: -1.33%
5. Austin, Texas: -1.30%
6. Salt Lake City, Utah: -1.29%
7. Phoenix, Arizona: -1.20%
Although for a sector of home buyers, the data that shows a decline in housing prices is perceived as something positive, for other market players, the fall can mean a warning sign.
Douglas Elliman real estate broker Jessica Peters explained in an interview with Moneythat this could translate into losses for the owners looking to sell their homes, after several months with historically high prices.
However, analysts believe that the reduction in housing prices will not continue for long, since mortgage rates are expected to fall throughout the year, which could make the market more competitive and transfer strength to the prices.
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Source: La Opinion