Home prices just hit a new record high in June, a phenomenon that will likely repeat itself for the foreseeable future.
While both buyers and sellers are waiting for interest rates to fall, affordability is expected to remain an issue.
Experts expect the number of buyers waiting for houses to become more affordable to continue driving prices up. It’s a simple case of demand outstripping supply. A decline in the borrowing rate also means that homebuyers will have more money to spend, which means bidding on houses will go up.
“They can actually pay more for a home than they otherwise would,” Ralph McLaughlin, senior economist for Realtor.com, told Fox Business. “When they go to bid on a house … they can bid up to price more than when mortgage rates were higher.”
The result? Prices will rise even more than they already have under the “success” of Bidenomics.
Fox Business reports on the latest record-breaking month for home prices. Here’s the start of the story:
Home prices hit a new record in June amid an ongoing housing shortage, even as high mortgage rates continued to push affordability out of reach for millions of Americans.
Prices increased 5.4% nationally in June when compared with the previous year, the S&P CoreLogic Case-Shiller index showed on Tuesday, down from the 5.9% pace recorded the previous month.
On a monthly basis, prices climbed 0.2%, according to the index.
“The upward pressure on home prices is making this the most unaffordable housing market in history,” said Lisa Sturtevant, Bright MLS chief economist. “First-time and moderate-income home buyers, in particular, increasingly are being left out of the housing market.”
The 10-city composite, which encompasses Los Angeles, Miami and New York, rose 7.4% annually, compared with an increase of 7.8% in May.
The 20-city composite, which also tracks housing prices in Dallas and Seattle, posted an annual gain of 6.5%, a decrease from the 6.9% figure recorded the previous month.
Prices rose in all the 20 major metro markets tracked by the index. The largest price gain took place in New York, which recorded a year-over-year increase of 9%. It was followed by San Diego and Las Vegas, with respective gains of 8.7% and 8.5%.