Home prices shot upward over the past two years. Driven by a historically low number of homes for sale and growing demand from buyers, prices surged. This year, though, the housing market has slowed. So, naturally, the price spikes have too. Right?
Well, there's good and bad news for prospective home buyers. First off, the price surge is likely over. Higher mortgage rates have calmed demand from buyers and allowed the number of homes for sale to increase. That's helped slow prices, which have already begun to show signs of deceleration. But according to the most recent S&P Case-Shiller Home Price Indices, price increases – while slower than before – are still pretty substantial.
Craig J. Lazzara, managing director at S&P, says this year's increases continue to outpace the typical year. “It's important to bear in mind that deceleration and decline are two entirely different things, and that prices are still rising at a robust clip,” Lazzara said. “For the first six months of 2022, in fact, the National Composite is up 10.6 percent. In the last 35 years, only four complete years have witnessed increases that large.” But while prices are still up significantly so far this year, they're expected to continue to decelerate through the end of 2022.
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