What’s Next For Housing Prices?

The housing market faces challenges like high mortgage rates and a shortage of homes, despite sustained demand. Additionally, changes in the home selling process are imminent. Potential home buyers should consider:

1. Supply and Demand Dynamics: Despite high demand, there's a shortage of existing homes, pushing buyers towards new constructions, especially in Southeastern and Southern markets. This increased availability has led to more transactions and reduced home price appreciation in existing sales.

2. Interest Rate Changes: Possible interest rate cuts could prompt more buyers to enter the market, exacerbating the low supply issue. Monitoring interest rate trends is crucial for potential buyers.

3. Market Conditions: Stay informed about local market conditions, as regions differ in terms of supply, demand, and pricing trends. Seek advice from real estate professionals to navigate market complexities.

4. New Construction Availability: With demand shifting towards new homes, explore options in markets where new constructions are abundant to have more choices and potentially avoid bidding wars.

CoreLogic Chief Economist Selma Hepp gives us insight into how a low supply of homes has been driving demand:

"There is a lack of existing supply of homes, which is driving demand towards new homes and there's been a greater availability of new homes, particularly in some markets in Southeast and South. So as a result of a greater availability of supply, we have seen more turnover, more transactions happening in those markets as well, and as a result of that slower rate of home price appreciation among existing home sales."