The average rate on a 30-year fixed mortgage was 6.42% last week, down for the second straight week but up from 6.09% in early February, according to Freddie Mac. The Federal Reserve approved its ninth consecutive interest-rate increase Wednesday and said it was too soon to tell how recent turmoil in the banking industry could slow the economy.
The metro areas posting the biggest price declines tend to fall into two categories: markets where prices skyrocketed in recent years as people moved in from other states, such as Phoenix and Austin, and markets where prices didn’t surge as dramatically during the boom but that were already prohibitively expensive, such as San Francisco and Los Angeles, said Black Knight’s Mr. Walden.
The hard-hit California markets have long been some of the nation’s priciest. Housing costs up and down the West Coast surged in the 2010s as the tech boom generated new high-paying jobs and enormous wealth. San Francisco home prices rose 112% between January 2012 and January 2020, outpacing a national 58% gain in that period, according to S&P Dow Jones Indices.
The median existing single-family home-sale price in San Francisco was $1.465 million in February, down from a peak of $2.06 million in March 2022, according to the California Association of Realtors. West Coast markets have also long been supply constrained due to high land costs and regulations on new-home construction.
As home prices hit new highs in 2021 and early 2022, these markets became even less affordable. In Los Angeles, about 63% of the area’s median household income would be needed to make mortgage payments on the average priced home in January, according to Black Knight.
Laura Johnson, a 59-year-old technology project manager, put her Seattle house on the market in September for $800,000. In October, after dropping the price to $745,000 and getting no offers, she took the house off the market.
“In Seattle, sales just completely dropped off,” she said.
Ms. Johnson relisted her home in February for $750,000. “I was very cautious about putting it back on,” she said.
She cut the price to $740,000 last week. If she sells her home, Ms. Johnson plans to move to Florida.
Don’t get boxed in by your bank’s lending limits. Let’s find the perfect lending solution for you, email me at acomcapital@gmail.com or book a time with me here: https://go.oncehub.com/RajaMaan
Follow us ACOM Capital
Follow us on social media
Welcome to Acom Capital, your gateway to tailored financing solutions for Investment Residential and Commercial Real Estate.
Copyright © 2024 Acom Capital. All Rights Reserved.
