Will Prices Go Down on Homes in 2018?

Will Prices Go Down on Homes in 2018?


If you're considering buying a home, you're probably wondering whether prices are likely to continue to decline. Rising mortgage rates, unaffordability, and Covid-19 are all factors that could contribute to a decline. If you're wondering what's behind the slowdown, you're not alone check out the latest features…. The housing market has been a bright spot for the economy in recent years, but now it's beginning to show its age.

Price declines

While home prices continued to rise in most states in recent months, prices declined in Colorado and Washington. Colorado's average price fell by $5,665 since June, or 1%. Based on values from Zillow.com, Colorado's median home price fell to $580,275. That's down more than two percent from July's average.

According to the CoreLogic Market Risk Indicator, which measures the health of the housing market, 12 metro areas have a greater than 50% probability of price declines within the next 12 months. Meanwhile, one-third of metros have a less than 10% chance of a decline. The risk for declines remains high in the Northeast, West, and Southwest, where unemployment is higher and income growth is weaker. In contrast, areas with a low risk of price declines are supported by low unemployment rates, solid housing starts, and strong income growth.


A recent report by ATTOM, a leading curator of real estate data nationwide, found that median-priced single-family homes and condominiums remained less affordable in the third quarter of 2022. It also found that 69 percent of counties' affordability indexes were historically lower than they are today.

The report estimates that for the median wage earner, a $340,000 home can be affordable. It takes into account the monthly mortgage payment, property taxes, insurance, and other expenses. It also assumes a 20 percent down payment and a 28 percent maximum front-end debt-to-income ratio. Then it compares that to annualized average weekly wage data provided by the Bureau of Labor Statistics.


Currently, the housing market is overheated, mortgage rates are rising, and the supply of homes is low. Meanwhile, consumer confidence is falling, and mortgage bailouts resulting from the pandemic are slated to expire this summer. In other words, home prices are expected to continue to rise until the summer of 2022. However, an increase in supply would help bring prices down. That would meet a surge in demand. However, global supply chain issues are hampering the supply of materials.

In a recent study, scholars studied the impact of the COVID-19 pandemic on the housing market. While COVID-19 affected the housing market in the short term, its impact on the market waned in the medium term. The study of the US housing market found that COVID-19 affected the housing market in two ways: a decrease in supply and a surge in demand. However, the impact of the pandemic on the housing market was a short-term one, and the impact weakened over the next three weeks.

Effects of rising rates on home values

Rising interest rates are one of the key factors that affect the value to sell home. They also determine how much you can borrow. Rising rates increase the cost of loans, which decreases the demand for homes. Rising rates cause buyers to look for homes with lower interest rates, and decrease the value of those homes with higher rates. The Fed is increasing rates in an effort to fight high inflation. It is currently increasing rates at a rapid pace, and the effect of these increases will be felt by home buyers and sellers.

Although rising interest rates aren't likely to cause a large change in home values, they can affect the real estate market. They will increase the cost of buying a home, which will slow down price appreciation and lead to higher inventory. Rising rates will also affect the home buying process, since buyers will have to wait longer to buy their home.

Markets with highest increases in home values

Home prices continue to rise, but a correction may be coming for the markets where home prices are the highest. Rising rates may affect affordability, and prices won't be able to rise as fast as they did previously. To prepare for this correction, you should monitor the current market in your area. Some markets are still on the upswing, while others have hit rock bottom.

The US housing market has been heating up for several years now. In fact, the median home value in the U.S. has increased by nearly forty percent since the Great Recession's bottom. However, this increase has come at a cost. The Federal Reserve, which is responsible for regulating mortgage rates, is ramping up its interest rates. The Fed's goal is to double the rate by 2022. These higher mortgage rates are stalling the housing sector. This means that prices will continue to rise, but at a slower rate than they have been.