For the first time in years, annual home list prices are posting negative growth, and housing markets that saw the largest gains during the pandemic are among the first to see the biggest declines in a 2023 correction, Realtor.com reports. With mortgage rates hovering in the 7% range, housing experts anticipate more home price reductions in the months ahead, especially in metros such as Boise, Idaho, and Austin, Texas, where year-over-year price per square foot is down -7.8% and -7.7%, respectively.
So where are home prices falling the most? The data team at Realtor.com found out. These are mostly places where prices shot up the most during the COVID-19 pandemic in the Western and Southern swaths of the country. In most of these places, there has been a lot of new construction helping to ease the housing shortage and taking the pressure off of prices to remain quite so high.
“Those markets that got the most juiced during the pandemic—where the prices really took off—are the markets where they’re now suffering the biggest declines because affordability has been the hardest there,” says Mark Zandi, Moody’s Analytics chief economist.
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