Home prices fall for second straight month as competition eases

Rebound in mortgage rates hinders buyer pressure on affordability

• Typical home values ​​fell 0.3% from July, the largest monthly decline since 2011.
• Housing competition is most intense in affordable metros and diminishes fastest in expensive metros.
• Lack of competition among buyers increases inventory and time to market.

, /PRNewswire/ — According to the latest news from Zillow® , Home values ​​slide for second straight month as mortgage costs continue to marginalize buyers Market Report ¹. Affordability is driving market momentum: low-cost markets remain competitive, while prices have fallen the fastest in the most expensive markets and those that have appreciated the most during the pandemic.

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In addition to affordability challenges, recent volatility in mortgage rates has made it difficult for many borrowers to qualify for a loan or even plan a purchase.

“Large daily and weekly rate changes mean many potential buyers are able to get a loan one week, but not the next, and vice versa,” Zillow Chief Economist

Skylar Olsen said. “Even buyers who can afford a home at current rates may feel frozen, waiting for mortgage rates to drop sharply again, as they did from late June to mid-July, when rates fell in just two weeks. Down 50 basis points.”

As the share of median household income required to pay monthly mortgage costs now exceeds the 30% level considered a financial burden, the uncertainty itself Could deter large numbers of homebuyers who might otherwise still be able to afford loans. Olson said the problem is likely to continue until the market stabilizes and returns to some kind of normalcy.

Typical U.S. home value fell 0.3% from July to August and is currently at $356,054

, by original2

Measured) Zillow Home Value Index. It was the biggest monthly drop since 2011, after falling 0.1% in July. Appreciation has receded since peaking in April, but typical home values ​​are still up 14.1% from a year ago and up 43.8% since August 2019 %, before the pandemic.

Typical mortgage repayments show a starker picture of the astronomical increase in spending by new homeowners over the past three years. The historic rise in home prices during the pandemic coupled with soaring mortgage rates this year has boosted monthly mortgage payments, including insurance and taxes, for the typical newly purchased home, from August 2019 $897

(0.9%), Indianapolis (0.5%), Cincinnati (0.4%) and Louisville (0.2%) . All four have typical home values ​​well below $300,000

Miami , ranked fifth Bit, breaking the trend here, but also by far the highest rental growth in the past three years, which could spur buying demand.

San Francisco saw the biggest month-over-month drop in home prices ^{(-3.4%), Los Angeles (-3.4%), Sacramento (-3.2 %) and Salt Lake City (-2.6%).}

Pending time for listings shows a similar trend, decreasing since July in Milwaukee for a day and held steady on Street. Louis , Cincinnati , Columbus and

Louisville . The market with the biggest increase was Las Vegas

, up 11 days,

to $1,643 – an increase of 83%. Less competition keeps homes on the market. Now, the typical time to list is 16 days3 , three more than in July days — a bigger increase than the market typically sees at this time of year — and above the six-day all-time low in April. Inventories edged up, up 1% from July. But it was the smallest monthly increase since February. The notable drop in the number of new listings that have flowed into the market over the past two months suggests that the small rise in total inventory is the result of longer periods of home sales, rather than additional sales activity. Mortgage rates hovering around 6% could deter many homeowners from selling their existing homes and entering the market as buyers. Affordable markets in the Midwest generally remain hot, while competition in Western markets is cooling rapidly, especially those that cost the most or appreciate the most in the pandemic. Home prices rose in 12 of the 50 largest U.S. markets between July and August, with Birmingham

.

Las Vegas and Austin

. Markets with the lowest markdown rates are Milwaukee , New York, Hartford and Boston.

Rental growth continued to slow in August with typical rent at $2,090 is now 12.3% higher than last August – down from February’s peak annual growth rate of 17.2%. Miami (21.9%), New York (17.9%),

Orlando (17.5%) and San Diego (17.1%).

August Zillow Home Value Index (ZHVI) (raw)

August ZHVI Year End – Year Change (Original)

August ZHVI Month – Monthly Change (Raw)

Typical days on the market (raw)

Markdown(Original)

Zillow Observed Rent Index (ZORI)

Year-over-year change in the rental index observed by Zillow

U.S

$356,054

14.1 %

-0.3 %

16

27.6 %

$2,090

12.3 %

New York, New York

$620,146

9.2 %

– 0.2 %

31

15.7 %

17.9 %

Los Angeles, CA

$897,864

6.8 %

26.0 %

$3,024

12.2 %

Chicago, Illinois

$312,487

9.4 %

-0.5 %

17

29.1 %

9.2 %

Dallas-Fort Worth, TX

$391,567

19.0 %

$3,342
-3.4 %	twenty three
$1,979

-1.4 %

15

36.1 %

$1,882

13.5 %

Philadelphia, PA

$338,914

-0.2 %

9.8 %

13

23.6 %

$1,869

9.3 %

Houston, TX

$312,579

15.3 %

-0.5 %

18

31.3 %

$1,633

7.6 %

Washington DC

$551,504

6.2 %

-0.6 %

14

27.9 %

$2,336