Price drops could be possible
Home price growth is expected to slow this year but in some places? There’s even a small chance that prices might decline — especially in the West.Verify your new rate (Dec 3rd, 2020)
Where home prices might drop
According to the Housing and Mortgage Market Review from Arch MI, a few states have a slight chance of declining home prices.
Alaskans have the biggest shot at potentially lower prices. According to the data, there’s a one in four chance that home prices will decline in the next two years.
Other states that have a shot include Connecticut, North Dakota, Texas and West Virginia, with an 18 to 19 percent chance of declining prices each. With the exception of Connecticut, all four states make the list due to “lingering effects of the slowdown in the energy-extraction sector and weak energy prices.”
Connecticut’s potential price cuts stem from the state’s overall “weak” housing market and its status as a “high-cost, high-tax state,” the report found.
More affordable metros?
At the metro level, Houston is most likely to see price drops in the next two years, because “home prices are far higher than expected compared to the historical relationship between prices and incomes,” Arch MI reported.
Other metros with a higher-than-average chance of declining prices include San Antonio, El Paso, Dallas-Fort Worth, McAllen and Austin Texas; New Haven and Hartford, Connecticut; Portland, Washington; and Boise City, Idaho.
Across the nation, there’s a mere 6 percent chance that home prices will be lower in the next 24 months. That’s up slightly from last quarter, though well below the historical average of 17 percent.Verify your new rate (Dec 3rd, 2020)
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