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Newsweek
23-04-2025
- Business
- Newsweek
US Home Prices Rising at Slowest Rate Since 2022
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. While home prices are still rising across the country, adding to the struggles faced by aspiring homeowners bogged down by high mortgage rates and growing uncertainty, they are now doing so at the slowest pace in years, according to the latest data. Home prices inched up 0.2 percent in March from February, real estate brokerage Redfin found, the slowest pace since December 2022. Why It Matters The U.S. is in the midst of a housing affordability crisis driven by rising home prices, historically high mortgage rates, and a chronic lack of inventory. With the median sale price of a home in the U.S. ($431,057) now 70 percent higher than it was in March 2020 ($302,462) and mortgage rates still hovering close to the 7 percent mark, many aspiring homebuyers have been squeezed to the sidelines. A slowdown in home price growth, which is being accompanied by rising inventory across the country could finally offer some relief and more negotiating power to buyers. But growing economic uncertainty over the impact of President Donald Trump's tariffs could undermine their gains. What To Know While home prices were still up 4.6 percent in March compared to a year earlier, the pace at which they rose slowed down from 5.1 percent the month before, marking the 11th consecutive month of slowing annual growth. The main reason behind this slowdown is that demand is not keeping up with growing inventory across the country. Despite the fact that more supply is desperately needed to fix the current gap existing in the U.S. housing market, many Americans just cannot afford to buy a home at the moment. Zillow Home Loans mortgage signage is displayed in downtown Phoenix, Arizona, on June 5, 2024. Zillow Home Loans mortgage signage is displayed in downtown Phoenix, Arizona, on June 5, 2024. PATRICK T. FALLON/AFP via Getty Images While demand is holding up in the Midwest, according to Redfin, in other parts of the country buyers "are backing off." In Florida and Texas, the two states that have built more new homes than any other over the past couple of years, unsold homes are piling up on the market as potential buyers are discouraged by rising homeowners association (HOA) fees and property insurance premiums. In many of these two state's former pandemic boomtowns, prices have now begun to fall. The same is happening across the country, with Redfin reporting that 20 of the 50 most populous U.S. metros recorded a drop in home prices between February and March. Columbus, Ohio, reported the biggest decline (-0.7 percent), followed by Denver, Colorado (-0.6 percent), and San Jose, California (-0.6 percent). Prices increased the most month-over-month in San Francisco (2.7 percent), Nassau County, New York (2.6 percent), and Milwaukee, Wisconsin (1.7 percent). What People Are Saying Sheharyar Bokhari, Redfin senior economist, said in a statement accompanying the report: "Homes are taking longer to sell and prices are falling in some areas because fear of a broader economic slowdown is pushing many would-be buyers to the sidelines. "New tariffs are adding to the economic uncertainty and prices may slow even further in coming months. With housing costs at near-record highs, that's a silver lining for a buyer who has to move right now, as there will be more room for negotiation." What Happens Next A majority of experts expect price growth to continue this year, but at a slower pace than it had in the past. The Mortgage Bankers Association foresees price growth to slow to 1.3 percent year-over-year by the end of 2025 and hold steady at that rate in 2026. The National Association of Realtors (NAR) expects home prices to grow 3 percent throughout 2025 and 4 percent next year.
Yahoo
13-04-2025
- Business
- Yahoo
Mortgage rates are little changed as financial markets swing wildly
Rates for home loans dropped slightly, offering a slight reprieve to Americans in the market to buy a home amid turbulence in the broader financial markets. In the week ending April 10, 30-year fixed-rate mortgages averaged 6.62%, Freddie Mac announced Thursday. That's down from 6.64% last week and 6.65% the week before. Those figures don't include fees or points, and rates in some parts of the country may be higher or lower than the national average. Financial markets have been in turmoil since President Donald Trump announced a new set of tariffs on various trading partners on April 2. Investors are watching the trajectory of the bond market carefully, since government bonds, like Treasurys, guide pricing for other products, such as mortgages. As a reminder, yields (rates) move in the opposite direction from prices. If investors are selling fixed-income products, prices go lower and yields higher. But if there's more demand, prices go higher and yields fall. Bonds are less attractive when economic growth is strong. They do better during downturns when investors prize stability − and when stocks, which represent a share of the future growth prospects of a company − are less certain. In the past week, bonds have been slammed hard, leaving many financial professionals uneasy. Mortgage rates aren't likely to rise as sharply as bond yields have, but there's little chance of ultra-low borrowing costs in the housing market any time soon. 'It's hard to predict the direction of mortgage rates with any conviction," said Kara Ng, senior economist at Zillow Home Loans, in an April 9 release. Over the past 10 days, mortgage rates have touched the lowest levels since October and then swung back to nearly 7%, she noted. "If mortgage rates stay at these high levels, buyers will be even more challenged by costs." This article originally appeared on USA TODAY: Mortgage rates steady amid financial-market meltdown. Sign in to access your portfolio
