Home prices see first year-over-year decline since 2012: Redfin

Housing pRices fell from February 2022 to February 2022, which was the first year-end decline since 2012. This could be a sign of bigger declines to come in the next year.

According to Redfin, the median U.S. home price dropped 1.2% to $386 721, in February.

‘SHOCKING’ PLUNGE IN CONSTRUCTION JOB OPENINGS AS FED RATE HIKES BEGIN TO STING

This is because the Federal Reserve’s interest rates hikes have pushed up mortgage rates, causing demand to drop off and home sellers to reduce prices.

“Buyers are struggling because higher interest rates have increased the cost of homeownership, and sellers are struggling because they’re still adjusting to the fact that their home won’t sell for what their neighbors did a year ago,” Andrew Vallejo is a Redfin agent in Austin, TX.

“The drop in prices is bringing more house hunters off the sidelines, but they’re in no rush because rates are high, and they have the upper hand,” He added.

According to the report, seasonally adjusted pending home sales fell by 26% in 12 months ending February. Seasonally adjusted new listings also fell by more than 23%.

Redfin’s report noted that the recent collapse of Silicon Valley Bank may have an impact on March’s housing prices. The Fed’s plan to increase interest rates is likely to be stopped by the shock to banks, which has led to mortgage rates falling a bit and more buyers entering the market.

Economists predict that home prices will fall more this year, as overheated housing markets bring down their prices.

Goldman Sachs researchers had predicted that Austin would see a drop in housing prices of more than 15% just this year. The report states that home prices in Phoenix, Denver, Seattle, and San Francisco will drop more than 10% this year, and will fall by 2024.

Redfin reported that median sales prices in San Jose, California fell 13.1% between a year and February 2012, respectively.

Redfin’s report provides a hint as to what you can expect from the National Association of Realtors next week when it releases February existing-home sales data. Although existing home sales have been declining, the decline in demand has not yet led to price drops.

According to NAR’s latest report, January sales fell by 36.9% compared to the previous year. In January, the median price for an existing home was $359,000. This represents a 1.3% increase over the year before. Additionally, homes typically remained on the market for 33 days in January, an increase from 26 days in December and 19 days in January 2022 — indications of a worsening housing market.

According to Freddie Mac mortgage rates have risen above 7% and now stand at 6.6% for a 30-year fixed mortgage. This is a 0.13 percentage-point decrease from the previous week due to SVB’s collapse.

The weak housing market is also showing signs of life in the labor market.

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In January, the construction industry had just 248,000 job openings. This is a decline of nearly 240,000 jobs compared to the previous month and a 37.4% drop from last year, according the Bureau of Labor Statistics data.

Anirban Basu is the chief economist at Associated Builders and Contractors. He described the decline in construction jobs as “a major economic crisis.” “simply shocking.”