Home Prices Plunge

Prices fell 4.7% and $54K from June to July. The metrics somewhat supported this but that's a massive decline month to month. Sales also dropped off but that is more in line with seasonal trends and you could argue were stronger than expected giving June's numbers.

Prices have levelled off to 'February' levels giving back a lot of the gains we had seen this year. Month to month, there can be some swings but it does feel like the amount of price changes and lack of activity could lead to some more downward price pressure.

The biggest thing to watch right now is inventory. When comparing to last year, we see that sales are relatively similar. It's funny because some in the industry have been making a big deal of sales jumping. The truth is we had 141 more sales in July 2024 vs. July 2023. I'd hardly call that a jump. New listings meanwhile were up apx. 2,500 vs. last year which is a material jump in what is typically a slow listing month. However, the most notable number is how much inventory is available. We have almost 8,500 more homes on the market vs. last year. Even with rates starting to drop, that inventory will take some time to be absorbed which bodes well for those looking to purchase.

On the flip side, it does seem rates will continue to trend downward which should improve affordability (by how much is the question) and new construction and home starts have plummeted indicating we could have another supply issue in the long-term. It appears that we are in for some bumpy times in the short-term but the long-term outlook appears to be much better...or so we hope.