After the pandemic-era boom, the housing market is finally showing signs of slowing down as home demand has waned following a combination of high home prices and rising mortgage rates that have pushed many potential buyers out of the market.
According to the latest proprietary case from Moody’s Analytics, as reported by wealthHome prices will rise by 0 percent next year – a dramatic drop from the 19.7 percent price growth that the property market has seen over the past 12 months.
However, analysts expect price changes to vary significantly across different regions of the United States. In its analysis of the country’s 414 largest housing markets, Moody’s forecasts that house prices will rise in 183 markets over the next year while falling in 231 others.
According to analysts at Moody’s, 2023 will see the biggest year-over-year price jumps in the following five cities:
- Albany, Georgia (4.12 percent)
- New Bern, North Carolina (4.12 percent)
- Augusta, Georgia (3.84 percent)
- Hartford, Connecticut (3.73 percent)
- Casper, Wyoming (3.29 percent)
On the other hand, the company’s analysts expect property prices to fall the lowest in these areas:
- The Villages, Florida (6.96 percent)
- Punta Gorda, Fla. (6 percent)
- Reno (5.57 percent)
- Honolulu (5.56 percent)
- Spokane, Wash. (5.52 percent)
The situation is slightly different in Moody’s forecast for 2024, with these cities expected to report the biggest jumps in house prices:
- Albany, Georgia (5.5 percent)
- Casper, Wyoming (4.52 percent)
- Columbus, Georgia (4.09 percent)
- Rocky Mount, North Carolina (3.97 percent)
- San Jose, California (3.83 percent)
While Albany remains solid at the top of the list and Casper sees an even stronger rise in home prices, Columbus, Rocky Mount and San Jose replace New Bern, Augusta and Hartford in the 2024 ranking.
In general, analysts at Moody’s expect that two years from now, more cities will see house price increases than in 2023, with 236 cities expected to see annual increases while only 178 regional housing markets are expected to see house price declines.
The five areas with the sharpest drop in property prices in 2024 are again led by The Villages and Punta Gorda, but there are also cities that didn’t make the 2023 list:
- The Villages, Florida (6.33 percent)
- Punta Gorda (5.71 percent)
- Cape Coral, Fla. (4.58 percent)
- Lake Havasu, Arizona (4.26 percent)
- Spokane, Wash. (4.11 percent)
A slowdown in the housing market will be necessary for the Federal Reserve’s plan to cool inflation to work, although there is a risk that the market’s rapid slowdown could lead to a crash.
Experts have so far dismissed concerns of a real estate crash similar to 2008, saying market conditions are much more stable and secure than before the financial crisis.
https://www.newsweek.com/five-cities-home-prices-jump-highest-2023-1734040 Five cities where house prices will rise the most in 2023: analysis