U.S. house prices are falling at their fastest monthly rate since the Great Recession. rising mortgage interest rates Housing market activity has slowed sharply.
Mortgage analytics firm Black Knight said in a report on Monday that median home prices fell 0.98% month-on-month in August, following a 1.05% drop in July.
Ben Graboske, President of Data & Analytics at Black Knight, said:
The price decline is the steepest since January 2009, when the economy was in the middle of its worst recession since the Great Depression, according to Black Knight. Median home prices are down 2% from their peak in June. Falling.
“The only month in which prices were significantly lower than July and August was the winter of 2008, following the collapse of Lehman Brothers and the ensuing financial crisis,” Gravoske said.
The once red-hot housing sector is in the midst of a serious correction. federal reserve We are raising interest rates at the fastest pace in decades.
of federal reserve Following similar hikes in June and July, the benchmark rate was raised by 75 basis points for the third straight month in September. This is his most aggressive series of rate hikes since 1994. His 3.25% was the highest since before the 2008 financial crisis. It’s also his fifth consecutive price increase this year.
In addition to the significant rate hikes, Fed officials have signaled an aggressive rate hike policy for the rest of the year. In new economic forecasts released after the two-day meeting, policymakers expect interest rates to reach 4.4% by the end of the year, suggesting a further three-quarters percentage point increase is under consideration. increase.
Mortgage interest rates have more than doubled to 6.29% and may continue to rise, according to recent data from mortgage lender Freddie Mac. And while home price gains have slowed over the past month, prices are well above their level just a year ago, making affordability out of reach for many prospective buyers. has become
new construction sale August saw an unexpected spike, with new single-family home purchases soaring nearly 29%. But economists said the unexpected rise was an anomaly and represented buyers’ efforts to bring down mortgage rates as the 30-year average fixed rate fell from its previous high to nearly 5%. I believe that there is no more than that.
Bill Adams, chief economist at Comerica Bank, said: “New home sales in August far exceeded expectations as homebuilders slashed prices and mortgage rates were slightly lower than they were in June and July. He said. “August’s stunning rise in home sales is unlikely to be repeated as mortgage rates hit another all-time high after the Federal Reserve’s decision in September.