US Economy: Housing Prices Cool at Record Pace

AUG 1 2022·Updated FEB 8 2024

Story

Image credit: Getty Images [via NBC News]

The Facts

According to a new analysis from mortgage data analytics firm Black Knight, the annual rate of US home price appreciation fell from 19.3% to 17.3% in June - the fastest pace on record.
NBC
The slowing pace in home values indicates that rising mortgage rates and wider inflation are dampening demand for housing.
NBC
Markets seeing the largest drops in home values previously had the highest home prices in the nation. San Jose, Calif. prices dropped 5.1% in the last two months, and Seattle, Wash. dipped by 3.8% in the same period.
NBC
Recession fears have also caused anxiety for prospective homebuyers as sales of existing homes have dropped below 2019 levels and sales of new construction homes also declined.
CNN
Despite the slowdown in the pace, price gains are still strong with the median home price climbing to $416k in June - up 13.4% from the previous year and the higest on record.
CNN
Last week, the Federal Reserve (Fed) announced a second consecutive 0.75-point hike in its benchmark interest rate in a historic attempt to fight rampant inflation.
ITN

Sources Split

LEFT

CENTER

RIGHT

ESTAB
CRIT

CENTER

PRO
ESTAB

The Spin

Narrative A

Since homebuying demand is low right now, it has given industries like homebuilding material suppliers and homebuilders freedom from the overwhelming pandemic-era demand and turbulence that drove up prices. The drop in demand will drop home prices, correcting the market and eventually bringing the US housing market back to normal.

The Washington Post

Narrative B

While it might not be equivalent to the 2008 crash, the US housing market is headed toward a significant decline in both home buying and home construction. Anyone who recently bought a house to beat the Fed interest rate hikes will now be sitting at a loss, and home prices will only drop further, essentially depleting the market.

New York Post