Source: Bankrate —
Home prices are up again. Only not as much.
The national median price for an existing single-family home price stands at $398,500 — an 8.6 percent year-over-year increase, according to the National Association of Realtors’ (NAR) just-released Metropolitan Median Home Prices & Affordability Report for Q3 2022.
Sounds high, but that actually represents a slowdown, compared to the previous quarter’s 14.2 rise in home prices. In fact, home sales have been slowing all around the U.S. throughout 2022.
However, the cost of buying a home has actually increased a lot more, thanks to rampant inflation and increases in interest rates. The monthly mortgage payment on that median-priced home with a 20 percent down payment is $1,840, according to the NAR — a jump of $614 (or 50 percent) from one year ago.
If you wanted to buy a typical single-family home in 2021, you needed an annual income of just $58,826 to qualify, according to the NAR. Now, a year later, you need an income of $88,331 — “almost $40,000 more than it was prior to the start of the pandemic, back in 2019,” said NAR Chief Economist Lawrence Yun in a statement accompanying the report’s release. And that’s assuming you meet credit and other standards and can afford a nearly $80,000 down payment (20 percent of the median home price).
In short, the national median single family existing home price rose up 8.6 percent year-over-year in the third quarter while monthly home payments rose 50 percent. Sales are de-accelerating, and so is home-value appreciation. Yet homes are less affordable than ever.
To put it mildly, the housing market seems to be somewhat in flux.
Which housing markets are up and which are down?
Nationally, the price of a median single family home grew from $367,100 at the end of Q3 2021 to $398,500 at the end of Q3 2022. Nearly all (181 out of 185) of metropolitan areas tracked by the NAR saw home price gains. But the amount of the gains is shrinking. Double-digit price increases occurred in 46 of those areas in Q3 2022 — down drastically from 80 percent in Q2.
As always in real estate, it’s a question of location, location, location. Among the major U.S. regions, the South registered the largest share of single-family existing-home sales (44 percent) and the greatest year-over-year price appreciation (11.9 percent) in the third quarter. Prices increased 8.2 percent in the Northeast, 7.4 percent in the West, and 6.6 percent in the Midwest.
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