Money Control Place
  • Politics
  • Business
  • Stocks
  • Investing
  • Politics
  • Business
  • Stocks
  • Investing

Money Control Place

Business

Home price growth is back at pre-pandemic levels. Here’s what that means for buyers and sellers.

by March 27, 2024
March 27, 2024
Home price growth is back at pre-pandemic levels. Here’s what that means for buyers and sellers.

The rate at which home prices grow is slowing down.

U.S. home prices increased 0.6% from a month before in February, in line with the 0.6% average monthly gain in the roughly eight years leading up to the Covid-19 pandemic, according to a new Redfin analysis.

Before the pandemic, it was normal for prices to grow about half a percent every month, or to increase around 5% or 6% annually, said Daryl Fairweather, the chief economist at Redfin.

“We’re back to that trend, despite these higher mortgage rates,” she said.

“Home prices are appreciating at the same pace as before,” he said. “It’s returned to the trend that we saw pre-pandemic.”

However, the market today is vastly different from the market two to eight years ago, experts say. The average home is still unaffordable for most potential buyers while inventory has slightly improved but not enough to meet demand.

“The sentiment we’re getting from our agents is that neither sellers nor buyers are satisfied with this market,” Fairweather said. “Sellers are dissatisfied … with offers that they’re getting. And buyers are disappointed in rising prices and rising mortgage rates.”

Levels of transactions are at ‘recessionary lows’ 

While the housing market has stabilized in terms of price growth, a major difference between the market today and the pre-pandemic period is the relatively low number of transactions, which is largely due to high mortgage rates, said Fairweather. Mortgage rates peaked at nearly 8% last year, but are still over 6%, according to Freddie Mac data.

In fact, the level of transactions are at “recessionary lows” despite “a pop in the data in February,” Walsh said.

Another factor affecting sales is the extremely limited supply of homes, he added.

New listings climbed 5% during the last four weeks ended March 17, the biggest year-over-year jump since May 2023, Redfin found. But “it’s like a small recovery from a rock bottom,” said Fairweather.

“We’re not back to where we were pre-pandemic,” she said.

Supply growth is mostly tied to a seasonal trend, economists say. Owners often list their homes for sale in February because they prefer to move in the spring and summertime, Walsh said.

And sometimes, life happens. “Another factor is just people needing to move for either a new job or they’re getting married, or there’s some other big life event,” Fairweather said.

The rate lock-in effect is loosening its grip

The mortgage rate lock-in effect, also known as the golden handcuff effect, kept homeowners with extremely low mortgage rates from listing their homes last year: They didn’t want to finance a new home at a much higher interest rate. Now, that is loosening its grip on the market and slightly boosting available supply, economists say.

“It was definitely keeping people in place, but the more time that passes, the less strong that effect becomes,” Fairweather said.

Some buyers who had put off listing their homes “are coming to terms with higher mortgage rates,” because they feel they can no longer postpone the move, Walsh explained.

While the rate lock-in effect is still playing a role in today’s low inventory, it will fade further over time, especially as the Federal Reserve decides to cut rates later this year, Fairweather said.

Mortgage rates are also forecast to modestly decline this year as the Fed trims interest rates, while home prices are likely to remain flat or unchanged nationally, Walsh said.

This post appeared first on NBC NEWS
0
FacebookTwitterGoogle +Pinterest
previous post
Chick-fil-A announces shift from ‘no antibiotics’ in chicken pledge
next post
StrategX Expands Nagvaak Critical Metals and Graphite Discovery with 45.6m Drill Core Interval

Related Posts

Another delivery driver dies as a battle rages...

September 2, 2023

Ben & Jerry’s co-founder resigns, claiming parent company...

September 29, 2025

Trump says national security concerns in Nippon-U.S. Steel...

June 15, 2025

Denny’s set to close dozens more locations this...

February 16, 2025

Howard Schultz, former Starbucks CEO, steps down from...

September 14, 2023

The Mirage casino, which ushered in an era...

May 18, 2024

As Lionel Messi descends, Miami economy faces another...

July 26, 2023

Consumer advocates, realtors hail NAR settlement: What it means...

March 25, 2024

FTX co-founder Sam Bankman-Fried should be jailed until...

July 27, 2023

Lawsuit says Clorox hackers got passwords simply by...

July 24, 2025

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest

    • S&P 500 Breaking Out Again: What This Means for Your Portfolio

    • CHARBONE Hydrogen Secures Harnois Energies’ Hydrogen Assets to Accelerate Clean Ultra High Purity Hydrogen Production at Sorel-Tracy

    • CHARBONE Hydrogene securise les actifs de production d’hydrogene d’Harnois Energies pour accelerer la production d’hydrogene propre a ultra haute purete a Sorel-Tracy

    • Anteros Metals Enters Into Letter of Intent and Announces Private Placement of up to $1 Million

    • Cartier Cuts 35.5 g/t Au over 0.5 m and 20.4 g/t Au over 0.5 m at Main ; Confirms Near-Surface High-Grade Gold Potential; Advances Toward VG10 Zone

    • Sranan Gold Samples Up To 26.7 Grams Per Tonne Gold in The Poeketi Pit Area of The Tapanahony Project in Suriname

    Categories

    • Business (1,395)
    • Investing (2,995)
    • Politics (3,699)
    • Stocks (1,812)
    • Uncategorized (20)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: MoneyControlPlace.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 moneycontrolplace.com | All Rights Reserved