After several unusual years, today’s higher mortgage rates helped usher in the first signs of the return of seasonality. As Selma Hepp, Chief Economist at , explains:
CoreLogic
“High mortgage rates have slowed additional price surges, with monthly
increases returning to regular seasonal averages. In other words, home prices
are still growing but are in line with historic seasonal expectations.”
Why This Is So Important To Understand
In the coming months, you’re going to see the media talk more about home prices. In their coverage, you’ll likely see industry terms like these:
•Appreciation: when prices increase.
•Deceleration of appreciation: when prices continue to appreciate, but at a slower or more moderate pace.
•Depreciation: when prices decrease.
Don’t let the terminology confuse you or let any misleading headlines cause any unnecessary fear. The rapid pace of home price growth the market saw in recent years was unsustainable. It had to slow down at some point and that’s what we’re starting to see – deceleration of appreciation, not depreciation. Remember, it’s normal to see home price growth slow down as the year goes on. And that definitely doesn’t mean home prices are falling. They’re just rising at a more moderate pace.
Bottom Line
While the headlines are generating fear and confusion on what’s happening with home prices, the truth is simple. Home price appreciation is returning to normal seasonality. If you have questions about what’s happening with prices in our local area, let’s connect.
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