Asking Home Prices Cool Most in Hottest Housing Markets: Las Vegas, Oakland, and San Francisco

SAN FRANCISCO, August 6, 2013 – Trulia, a leading online marketplace for home buyers, sellers, renters, and real estate professionals, today released the latest findings from the Trulia Price Monitor and the Trulia Rent Monitor. Based on the for-sale homes and rentals listed on Trulia, these monitors take into account changes in the mix of listed homes and reflect trends in prices and rents for similar homes in similar neighborhoods through July 31, 2013.

Asking Home Prices Fall 0.3 Percent Month-Over-Month

Asking home prices are now starting to lose steam as mortgage rates rise, inventory expands, and investor demand declines. Nationally, asking prices dropped 0.3 percent in July – the first month-over-month (M-o-M) decline since November 2012. Seasonally adjusted, prices rose 3.3 percent quarter-over quarter (Q-o-Q), down from a peak of 4.2 percent in April. Year-over-year (Y-o-Y), prices are up 11 percent nationally; however, this change is an average over the past 12 months and is therefore slower to show changes than monthly and quarterly numbers.

Asking Home Prices Now Slowing Down in the West

In 64 out of 100 U.S. metros, the quarterly asking home price gain was lower than in the previous quarter. This slowdown was most apparent in the West Coast where prices have rebounded strongly already. Among housing markets where asking prices rose sharply Y-o-Y, price gains dipped the most Q-o-Q in Las Vegas, Oakland, and San Francisco. Other California metros, including Sacramento, Ventura County, San Jose, and Fresno, saw Q-o-Q gains drop by at least two percentage points between April and July. Meanwhile, many metros in the South and Midwest are seeing price gains accelerate, such as Atlanta (3.2 percentage points higher in July versus April) and Detroit (3.7 percentage points).

Although some may seem the market cool down as a negative thing, investors on the other side of the spectrum will now rejoice. “If you were worried about a housing bubble, July’s asking-price slowdown will probably be the best news you’ve heard this year,” said Jed Kolko, Trulia’s Chief Economist. “The asking home price slowdown in July could be the start of the return to normal price gains. The blazing fast price increases we’ve seen in recent months could not last, especially with rising mortgage rates, expanding inventory, and declining investor interest.”

From the official TRULIA press release. For more info please see http://info.trulia.com/