Prices of Homes are Not Falling

Some housing analysts predicted a drop in home values in 2023 during the fourth quarter of last year. The media jumped on the estimates and published headlines predicting doom and gloom in the property market. All of the negative news coverage has caused many individuals to question the strength of the residential real estate market.

If it made you question if you should delay your own plans to move, here’s what you really need to know.

Home Prices Never Crashed

Disregard what you saw in the headlines. The actual data shows home prices were remarkably resilient and performed far better than the media would have you believe (see graph below):

This graph uses reports from three trusted sources to clearly illustrate that prices have already rebounded after experiencing only slight declines nationally. That’s a far cry from the crash so many articles called for.

The declines that did happen (shown in red), weren’t drastic but were short-lived. As Nicole Friedman, a reporter at the Wall Street Journal (WSJ), says:

“Home prices aren’t falling anymore. . . The surprisingly quick recovery suggests that the residential real-estate downturn is turning out to be shorter and shallower than many housing economists expected . . .”

Even though some media coverage made a big deal about home prices pulling back, the slight correction that happened is already in the rearview mirror. Basically, this data shows you home prices aren’t falling anymore; they’re actually going back up.

What’s Next for Home Prices?

The consensus among experts is that home price growth will continue in the years ahead and is returning to normal levels for the market. That means we’ll still see home prices appreciate, just at a slower pace than the last few years, and that’s a good thing.

When home price rise slows, some news outlets will publish stories that lead you to believe prices are falling again. The emergence of such deceptive headlines is already having an effect on how homebuyers feel. You can see how this affects general opinion in the Consumer Confidence Survey from Fannie Mae (see graph below):

While the percentage of Americans who think prices will fall has been slowly declining this year, the latest Consumer Confidence data indicates that’s ticked back up recently (shown in red). This change is surprising, especially since the home price data shows prices are going up, not down. It tells you the impact the media still has on public opinion.

Don't fall for the negative headlines and become a statistic. Remember that evidence from a variety of sources indicates that property values are no longer decreasing.

Bottom Line

Despite what the media portrays, figures reveal that property values are no longer declining. Don't allow the news worry you or cause you to postpone your plans. Let's connect so you have a reliable resource to break through the noise and tell you what's actually going on in our community.