RISMedia
  • News
  • Premier
  • Reports
  • Events
  • Power Broker
  • Newsmakers
  • More
    • Publications
    • Education
No Result
View All Result
  • Agents
  • Brokers
  • Teams
  • Marketing
  • Coaching
  • Technology
  • More
    • Headliners New
    • Luxury
    • Best Practices
    • Consumer
    • National
    • Our Editors
Join Premier
Sign In
RISMedia
  • News
  • Premier
  • Reports
  • Events
  • Power Broker
  • Newsmakers
  • More
    • Publications
    • Education
No Result
View All Result
RISMedia
No Result
View All Result

Key Metro Price Drops Are ‘Starting Gun’ for Pullback

Home Agents
By Jesse Williams
July 21, 2022
Reading Time: 2 mins read
Key Metro Price Drops Are ‘Starting Gun’ for Pullback

The latest analysis from a joint initiative between Florida Atlantic University (FAU) and Florida International University (FIU) is showing a possible peak in the housing market, indicating that prices are on their way back down to more reasonable—and hopefully affordable—levels.

The initiative has sought to track what markets are most overvalued based on publicly available pricing data, using their own methodology and historical trends. With the most recent report showing a dozen metros edging back toward more level prices, researchers are cautiously projecting that prices will continue to fall across the country.

“Premium declines are an early warning sign that prices are leveling off and likely on the way back down,” said FAU economist Ken Johnson in a statement. “We will look back at this point as the starting gun for the down slope in our next housing cycle.”

Even though the National Association of REALTORS® (NAR) found that home prices are still climbing year-over-year across the country, Johnson and fellow researcher Eli Beracha, director of FIU’s Hollo School of Real Estate, highlighted several overvalued and expensive metros that saw average home prices falling this summer.

Notable price drops came in San Jose, California (down by $13,091); Austin, Texas ($3,010); Seattle, Washington ($1,922); San Francisco, California ($1,568); Ogden, Utah ($879); San Diego, California ($541) and Stockton, California ($128).

“While 12 premium declines and seven average price declines are substantial numbers and very suggestive of a slowdown, I’d like to see data from another month or two before calling the peak,” said Beracha. “We have a substantial inventory shortage around the country, and this may help to buoy prices for a while longer.”

The top-most overvalued markets have remained largely unchanged, with Boise, Idaho, as the metro with the highest premium on homes (69.2% higher than they should be). Austin, Texas (65.8%); Las Vegas, Nevada (63.73%); Ogden, Utah (62.8%) and Fort Myers, Florida (62.3%) rounded out the top five.

At the same time, many metros are seeing their home prices continue to skew away from fundamental values—albeit more slowly than early in the year. Many of those metro were in the south, including Fort Myers, Florida (3.4% more overvalued compared to last month); Lakeland, Florida, and Nashville, Tennessee (both 2.9%); Greenville, South Carolina (2.5%); Charlotte, North Carolina (2.3%) and El Paso, Texas (2.1%).

Johnson and Beracha emphasized again, as they have in previous reports, that the upcoming (or ongoing) slowdown will look very different depending on the market. Areas that continue to struggle with new inventory but also maintain population growth will have a “muted” price decline, while areas with flat or negative population growth and more abundant housing could see “sharply” decreasing prices.

Likely, the Federal Reserve—which has indicated that it will implement another large rate hike at its meeting next week—will see falling prices as an indication that its policies are working, Johnson and Beracha said, even though the slowdown will be painful for some.

“Fed policies are taking hold and having the desired effect,” Johnson said. “Our premium declines in 12 housing markets combined with falling consumer sentiment and lagging builder confidence mean we should begin to see less aggressive behavior from the Fed as housing prices come under control.”

Tags: FAUFeatureFIUHome Price AppreciationHousing Markethousing price dropsReal Estate Marketreal estate research
ShareTweetShare

Jesse Williams

Jesse Williams is a senior editor for RISMedia.

Related Posts

Bank Crashes Add New Uncertainty for Commercial Sector, Apartments
Agents

Bank Crashes Add New Uncertainty for Commercial Sector, Apartments

March 24, 2023
Fathom: Weak Q4 but Strong YoY Revenue, Agent and Transaction Growth
Agents

Fathom: Weak Q4 but Strong YoY Revenue, Agent and Transaction Growth

March 24, 2023
New Home Sales Rise for Fifth Consecutive Month
Agents

New Home Sales Rise for Fifth Consecutive Month

March 24, 2023
How to Get on the FHA Condo Approval List
Agents

How to Get on the FHA Condo Approval List

March 24, 2023
Weichert Expands Presence in Maryland
Agents

Weichert Expands Presence in Maryland

March 24, 2023
THE PLAYBOOK: People-Skill Strategies to Stimulate Sales This Season
Agents

THE PLAYBOOK: People-Skill Strategies to Stimulate Sales This Season

March 23, 2023

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Tip of the Day

4 Ways to Leverage Augmented Reality to Improve the Homebuying Experience

From improving the showing experience to helping clients visualize what their new home could look like, here are a few ways that augmented reality could help you improve your client's search for their perfect home. Read more.

Business Tip of the Day provided by

Recent Posts

  • Bank Crashes Add New Uncertainty for Commercial Sector, Apartments
  • Fathom: Weak Q4 but Strong YoY Revenue, Agent and Transaction Growth
  • New Home Sales Rise for Fifth Consecutive Month

Categories

  • Spotlights
  • Best Practices
  • Advice
  • Marketing
  • Technology
  • Social Media

The Most Important Real Estate News & Events

Click below to receive the latest real estate news and events directly to your inbox.

Sign Up
By signing up, you agree to our TOS and Privacy Policy.

About Blog Our Products Our Team Contact Advertise/Sponsor Media Kit Email Whitelist Terms & Policies ACE Marketing Technologies LLC

© 2023 RISMedia. All Rights Reserved. Design by Real Estate Webmasters.

No Result
View All Result
  • Home
  • Premier
  • Reports
  • News
    • Agents
    • Brokers
    • Teams
    • Consumer
    • Marketing
    • Coaching
    • Technology
    • Headliners New
    • Luxury
    • Best Practices
    • National
    • Our Editors
  • Publications
    • Real Estate Magazine
    • Past Issues
    • Custom Covers
  • Events
    • Upcoming Events
    • Podcasts
    • Event Coverage
  • Education
    • Get Licensed
    • REALTOR® Courses
    • Continuing Education
    • Luxury Designation
    • Real Estate Tools
  • Newsmakers
    • 2023 Newsmakers
    • 2022 Newsmakers
    • 2021 Newsmakers
    • 2020 Newsmakers
    • 2019 Newsmakers
  • Power Broker
    • 2023 Power Broker
    • 2022 Power Broker
    • 2021 Power Broker
    • 2020 Power Broker
    • 2019 Power Broker
  • Join Premier
  • Sign In

© 2023 RISMedia. All Rights Reserved. Design by Real Estate Webmasters.

x
X