Have Home Values Hit Bottom?
Whether you're a current or prospective homeowner, recent headlines about home prices may leave you with more questions than answers. Home prices are falling in news stories, which raises concerns about a repeat of what happened during the 2008 crash.
Based on those headlines, one of the questions on many people's minds is: how much will home prices fall? What you may not realize is that expert forecasters are not predicting a free fall in prices. In fact, based on the most recent data, there's a case to be made that the majority of month-over-month price depreciation may already be behind us - and even those numbers weren't signed on a national scale. Instead of asking how far they will fall, the question should be: have home values reached rock bottom?
Let's look at the most recent data from reputable industry sources (see chart below):
The graph above depicts the most recent Case-Shiller, Federal Housing Finance Agency (FHFA), Black Knight, and CoreLogic report. It depicts how home values have changed on a national scale month after month since January 2022. The numbers for November and December have yet to be released.
Let us concentrate on what the red numbers indicate. The red numbers represent the published change in home values over the last four months. And when we isolate the last four months, the data shows that home price depreciation peaked in August in each case.
While this does not guarantee that home price depreciation has ended, it does confirm that prices are not in free fall, and it may be an early indication that the worst is already behind us. As data for November and December are released, this national trend will be validated further.
Home prices have fallen month after month for the first time on record, but there's a strong case to be made that the worst is over. If you have any questions about what's going on with home prices in your area, contact a reputable real estate agent.
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