Those watching the real estate market have noticed the recent volatility in market prices, mortgage rates, and how quickly homes are bought and sold. Across the country, many regions have begun to experience a real estate slowdown and housing prices have begun to quickly fall in several metropolitan areas. We will explore what is currently going on with average home prices by city, where we have begun to see some of the biggest price drops, and how you, as a real estate agent, can make sure you stay up-to-date on the latest trends so you can better serve your clients.
Why Have Housing Market Prices Dropped?
It is widely acknowledged that the housing market, which was red hot during the pandemic, has begun to cool down a bit. The possibility of a recession continues to loom over everyone’s heads as well, which has impacted the prices of homes. The slowdown has resulted in changes in home buying and selling behavior. Specifically, we now see fewer bidding wars and a greater amount of inventory in many regions, signifying the likely end of the pandemic housing boom. Mortgage rates have also hit the highest levels we have seen since 2008. Altogether, this creates a situation where housing prices have begun to fall in many regions of the country. We will look at a few locations where this change has been the most drastic.
Which Cities have the Biggest Differences in Home Prices?
There are a few specific regions that have had particularly marked drops in housing prices. Many of these areas also saw the most dramatic spikes during the pandemic as people took advantage of remote work or saw the shutdown as an opportunity to explore someplace new. However, much of the chaos and restrictions that surrounded the pandemic have begun to slow and the rush that accompanied the pandemic housing boom has begun to fade. Rising mortgage rates have also caught the attention of buyers and may likely impact their buying decisions for the foreseeable future.
One of the biggest drops in prices can be seen in Boise, Idaho. The city saw an 80% spike in home prices last year, but now there is a sharp decline with over 60% of sellers reducing list prices in order to become more appealing to potential buyers.
Behind Boise, both Denver and Salt Lake City also saw spikes in pricing but are now experiencing slowdowns as well. A little over half of the sellers in these two cities are reducing their prices.
Finally, there are several cities and regions across the country where between 40 and 49 percent of sellers have begun to price reduce in order to attract more potential buyers. You can see this clearly in cities like:
- Grand Rapids, MI
- Sacramento, CA
- Seattle, WA
- Portland, OR
- Tampa, FL
- Indianapolis, IN
Those interested in buying homes in these particular regions, and agents who want to serve clients either buying or selling in these current market conditions, need to be aware of these trends to make sure that they understand how to leverage current market conditions and secure the best possible outcome for not only their clients, but themselves as well.
How New and Existing Agents can Prepare
As a real estate agent, knowing how to navigate different types of market conditions is essential to success. Although we have seen a housing boom over the past few years, several signs now point to that trend phasing out in favor of falling home prices and ever-increasing inventory levels. Knowing how to serve clients in all types of markets can help real estate agents achieve greater success despite these market conditions.
The key to providing clients with the help they need is real estate continuing education. Having resources that can provide you with important insights into the market, including what to watch for and how buyers and sellers can thrive in different market conditions, will help you provide optimal services for your clients. Fortunately, Colibri Real Estate is here to help you achieve this goal.
If you want to level up your skill set and improve the services you offer, and better understand all the different market conditions that your clients may potentially face, don’t hesitate to partner with Colibri Real Estate. With countless learning resources and continuing education opportunities available, we’re the real estate school that makes it easy for agents to better educate themselves and advance their careers.
