Home Prices Declined in Feb., Marking First YOY Drop in A Decade
New York, NY, March 22, 2023-"The first year-over-year drop in home prices in more than a decade and a dip in mortgage rates snapped a yearlong streak of declining monthly home sales, showing the effects of the Federal Reserve’s campaign to raise interest rates,” reports the Wall Street Journal.
“Sales of previously owned homes, which make up most of the housing market, rose 14.5% in February from the prior month but were down 22.6% from a year earlier, the National Association of Real-tors said Tuesday. Sales had decreased for 12 consecutive months through January.
“Buyers benefited from a slight improvement in affordability as home prices ticked lower and mortgage rates eased from a 20-year high touched last fall.
“The national median existing- home sale price fell 0.2% in February from a year earlier to $363,000, the first year-over year decline since February 2012. Median prices, which aren’t seasonally adjusted, were down 12.3% from a record in June.
“Mortgage rates topped 7% in November but fell to near 6% in early February before fluctuating in recent weeks.
“The housing-market slowdown in the past year shows one of the main ways that the Fed’s aggressive interest-rate increases are rippling through the economy. Housing is one of the most rate-sensitive economic sectors, and high housing costs have been a big contributor to inflation.”