{"id":2490,"date":"2018-09-27T10:00:37","date_gmt":"2018-09-27T10:00:37","guid":{"rendered":"https:\/\/thezakariagroup.com\/are-home-prices-softening-or-are-they-falling\/"},"modified":"2018-09-27T10:00:37","modified_gmt":"2018-09-27T10:00:37","slug":"are-home-prices-softening-or-are-they-falling","status":"publish","type":"post","link":"https:\/\/thezakariagroup.com\/are-home-prices-softening-or-are-they-falling\/","title":{"rendered":"Are Home Prices Softening or Are They Falling?"},"content":{"rendered":"
\n

\"Are<\/p>\n

We are beginning to see reports that more housing inventory is coming to the market and that buyer demand may not be increasing at the same pace it did earlier this year. The result will be many headlines written to address the impact that these two situations will have on home values.<\/span><\/p>\n

Many of these headline writers will confuse \u201csoftening home prices\u201d with \u201cfalling home prices,\u201d but there is a major difference between the two.<\/p>\n

The data will begin to show that home values are not appreciating at the same levels as they had over the last several years (softening prices). This does NOT mean that prices are depreciating (falling prices).<\/p>\n

Here is an example: Over the last several years, national home values increased by more than 6% annually. If you had a home worth $300,000 at the beginning of the year, it would be worth $318,000 by year\u2019s end. If the appreciation rate \u201cfalls\u201d to 4%, that $300,000 house would be worth $312,000 at the end of next year \u2013 a $6,000 difference.<\/p>\n

The price of the home did not fall. It just didn\u2019t increase at the level it had the previous year.<\/p>\n

Appreciation rates are projected to end this year at approximately 5%, and then drop to somewhere between 4-5% next year. This drop in appreciation rate will cause home price increases to soften.<\/strong><\/p>\n

Again, this does not mean that home prices will depreciate, but instead that they will appreciate more slowly. <\/strong><\/h4>\n

Bottom Line<\/strong><\/h3>\n

Be careful when reading headlines that discuss home values. Some headline writers will be legitimately confused and will use the word falling<\/em> in place of softening<\/em>. Others will realize that the headline \u201cHome Prices are Falling!\u201d will get more clicks than \u201cHome Prices are Softening\u201d and will intentionally write the more compelling headline. Read the article. If the word depreciation is not mentioned, home values are not falling.<\/strong><\/p>\n<\/div>\n

Powered by WPeMatico<\/a><\/small><\/p>\n","protected":false},"excerpt":{"rendered":"

We are beginning to see reports that more housing inventory is coming to the market and that buyer demand may not be increasing at the same pace it did earlier this year. The result will be many headlines written to address the impact that these two situations will have on home values. 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