A Few Areas May See Home Prices Decline

 

 

A Few Areas May See Home Prices Decline

 

Moody’s: A Few Areas May See Price Declines Prediction: Local home prices could drop perhaps 5%-10% in a few U.S. areas with large home price increases that far surpassed their area’s household incomes. Up 34.4% over the past two years, including a 19.8% spike over the past year – along with inflation and mortgage rates, more economists are voicing concerns about a possible price decline The 19.8% gain is more than four times greater than the historic annual average posted since 1987, and well over the largest 12-month price jump posted in the years leading up to the 2008 financial crisis. Unless buyer demand drops precipitously and a rash of sellers decide it’s time to list their home, the end result would be price stabilization rather than a bubble that pops. In 2007, many of the country’s most overpriced housing markets were in California, New York, and Florida.