Why NOW might be a good time to buy a home: Almost 1 in 4 sellers are slashing asking prices by a typical $15k – here’s where property values are rising (and falling) fastest

Home sellers have no choice but to lower their asking prices to attract buyers. Who restrained high interest rates, says a new report.

According to real estate website Zillow, about 23 percent of homes listed for sale in November have been marked down in price since they were first listed. Researchers said the number was “abnormally high” for this time of year.

The trend is being driven by rising mortgage rates, which have fallen slightly in recent weeks but remain above 7 percent, making payments on a typical home about $1,000 a month more expensive than they were two years ago.

New home sales are down Growth was 15.9 percent between October and November, according to a Zillow report released this week. Sales were also down 4.6 percent from November last year.

But the picture varies widely across the country, with some metros doing much better than others. The Zillow report shows where home values ​​rose or fell the fastest over the past year.

Individual numbers from Redfin show the extent of the price decline. For example, houses in New Orleans now I’m selling for about 5 percent below the asking price. Meanwhile, sellers in Naples, Florida, Memphis and Chicago are cutting prices by 5 percent, 4 percent and 2 percent, respectively.

Since the average home in New Orleans now costs $310,000, a 5 percent discount would be a savings of $15,500.

A Zillow report notes: “Home buyers and sellers braving the wind and rain later in the year are in for a few early holiday surprises.

“Monthly costs for a new mortgage are falling, inventory is nearing normal levels, and price declines are unusually common.”

But the picture varies widely across the country, with some metros doing much better than others.

Zillow data shows Hartford, Connecticut, saw the strongest price increases last year. The cost of housing in the region increased by 11.3 percent.

It was followed by Milwaukee, Wisconsin, San Diego, California, and Providence, Rhode Island, where home values ​​rose 8.5 percent, 7.6 percent and 7.4 percent, respectively.

Rounding out the top five was Boston, Massachusetts, where home values ​​jumped 7.2 percent.

By comparison, New Orleans, Louisiana saw the biggest drop in home values. Property values ​​there fell by 8.9 percent.

It was followed by Austin and San Antonio, both in Texas, where prices fell 8.2 percent and 3 percent, respectively.

In Jacksonville, Florida, and Memphis, Tennessee, home values ​​also fell 1.5 percent and 0.9 percent each.

The findings come as average monthly mortgage payments are now nearly double what they were when Biden took office.

The analysis is based on a $430,000 home with a 30-year mortgage and assuming a 10 percent down payment. It also doesn’t explain the slight drop in mortgages in recent weeks.

The rise in mortgage rates was fueled by the Federal Reserve’s aggressive campaign to raise interest rates from near zero in April 2020 to a 22-year high of 5.25 to 5.5 percent.

Higher interest rates and rising house prices mean buyers are facing one of the least affordable markets in recent memory.

The rise in mortgages was fueled by the Federal Reserve’s aggressive campaign to raise interest rates from near zero in April 2020 to a 22-year high of 5.25 to 5.5 percent.

Higher interest rates are being used to curb running-hot inflation in the hope that they will curb consumer spending and bring prices back under control.

But cooling inflation, which currently hovers at 3.2 percent a year, has allowed the Fed to hold rates steady for two straight meetings since July.

As a result, mortgages also finally began to fall. The latest data from government-backed lender Freddie Mac shows the average rate on a 30-year fixed-rate mortgage fell to 7.03 percent, the lowest level since early August.

But homeowners who bought in the last few years are still stuck paying an extra $1,000 a month for a new home.

At today’s rates, a buyer buying a $400,000 home would face mortgage payments of $2,536 on a 30-year mortgage. This analysis assumes a five percent deposit.

But just two years ago, when rates were 3.10 percent, the same buyer would have paid just $1,623 a month.