Those wanting to buy a home wonder if houses will become more affordable soon.
Those thinking about selling wonder when is the best time to sell.
Many thought a rapid slowdown in price appreciation would occur by the end of 2021 and the beginning of this year but as the data shows, that isn’t the case. Prices instead accelerated in December and are still going strong.
To be clear, Acceleration means prices increase at a greater year-over-year rate than the prior month. Deceleration means home prices will continue to rise but at a slower speed than year-over-year appreciation. Depreciation indicates home prices drop below current values but that’s in nobody’s forecast!
S&P’s Case Shiller showed appreciation accelerated in 15 of the 20 metro areas they report on and the Federal Housing Finance Agency (FHFA) revealed that price appreciation accelerated in December in six of the nine regions it tracks.
If you’re a first-time homebuyer or someone looking to sell a house and buy a home that better fits your needs, waiting could cost you in two ways:
Likely for this year and possibly for next, the more time goes by, the more mortgage rates will increase and home prices will continue to go up, possibly making it more difficult for you to afford a home if you’re buying.
If you’re selling, there may be less buyers for your home as affordability decreases with the increase in mortgage rates.
“If you’re thinking about waiting until next year and that maybe rates are higher, but you’ll get a deal on prices – well that’s risky. It may be more advantageous to purchase this year relative to waiting until 2023 at this time.” ~ Deputy Chief Economist at Freddie Mac, Len Kiefe