August 20, 2019
What’s Happening in Home Price Appreciation?
Home price appreciation is a fraught topic these days. The way home prices are going—the numbers hold some market watchers captivated.
According to the CoreLogic Home Price Index, annual appreciation of home prices decreased year-over-year from 6.1 percent in January 2018 to 4.4 percent in January 2019. Some are taking this as a problem—from the point of view that appreciation in prices is the primary marker of a healthy housing market. (As might be fairly obvious, this point of view will come from the perspective of those who stand to gain profit from higher sale prices. Ongoing price appreciation has caused problems for others, on the other hand—such as younger prospective home buyers looking to gain a foothold in the starter home market, and those whose income is modest but who might like to move from starter homes into the next echelon of housing.)
Decreasing appreciation appears to be acting as something of a release-valve for the market—and along with lower mortgage rates prevailing through the first half of 2019, affordability has increased. Meanwhile it isn’t all bad news for sellers. After all, slowed appreciation is still appreciation—the bottom has not dropped out, and those with a longer view might recognize that an unchecked trend toward hyper-appreciation of housing prices would most likely lead to a bubble of sorts, in which that bottom might drop out indeed. We think everyone can agree that the last thing the housing market needs is a scenario in which the pressure-cooker bursts.
The general trend always has its exceptions, of course—and the only two metropolitan areas to continue double-digit housing appreciation were Las Vegas, Nevada, and Philadelphia, Pennsylvania, which both increased by 10.5 percent in January 2019. Interestingly the metro area with the least appreciation year-over-year was San Francisco, California, where prices only went up by 1.6 percent.
This slow in price appreciation means it’s a good time to buy. Whether you’re looking to buy in Westchester, Massachusetts; West Palm, Florida; or Newport, Rhode Island, you’ll need to make sure your new home is not threatened by defects in your ownership of title. At Topouzis & Associates, P.C., we delve deeply into the history of your properties in order to ensure that your property ownership will not be hindered by past issues, and we provide the Title Insurance to back our assessments. Contact us to ensure that you are covered in case of surprise.