Have housing prices finally stopped climbing? One forecast says yes

Aly J. Yale
The Mortgage Reports contributor

Turning things around

It’s the moment everyone’s been waiting for. According to the latest Home Price Index Report from CoreLogic, housing prices are finally turning around, and by the time January’s numbers are in, they could even be on the decline.

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Prices start to pivot

According to CoreLogic’s forecast, January’s numbers will likely show a slight downturn in home prices for the first time in nearly four years. CoreLogic predicts prices to drop by 0.4 percent for the month. Considering prices rose a half-percent in December and 6.6 percent over the course of 2017, even this slight decline is positive news for today’s buyers.

The CoreLogic forecast predicts home prices will continue dropping at least through September.

Still, because home prices have risen steadily over the past few years, they’re expected to clock in at 4.3 percent higher than 2017 by year’s end. That’s down from 2017’s growth rate of 5.9 percent.

Housing affordability still high, despite rising home prices

According to Frank Nothaft, CoreLogic’s chief economist, low inventory continues to pose a problem for home prices.

“The number of homes for sale has remained very low,” Nothaft said. “Job growth lowered the unemployment rate to 4.1 percent by year’s end, the lowest level in 17 years. Rising income and consumer confidence have increased the number of prospective homebuyers. The net result of rising demand and limited for-sale inventory is a continued appreciation in home prices.”

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Where to buy

The largest price gains over the last year were in California, Idaho, Utah, Washington and Nevada. But the latter may still be a great place to buy.

According to CoreLogic’s data, the state’s prices are 22.6 percent below their housing crisis peak – the biggest gap in the entire nation.

Home prices rise – except in these states

States with low year-over-year growth included Hawaii, Oklahoma, Virginia and Connecticut.

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Want to capitalize on lower home prices? Shop around and see what mortgage rates you qualify for today.

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