By Alice Seeley
On Aug. 1, Black Knight Data & Analytics Inc. reported that year-over-year home price growth decreased by 2% from 19.3% to 17.3% in June, the “greatest single-month slowdown on record” since the early 1970s.
This dramatic decrease was caused by rising mortgage rates and record-high inflation, although house prices are still higher than they were a year ago.
“While this was the sharpest cooling on record nationally, we’d need six more months of this kind of deceleration for price growth to return to long-run averages,” stated Ben Graboske, Black Knight’s CEO. “Given it takes about five months for interest rate impacts to be fully reflected in traditional home price indexes, we’re likely not yet seeing the full effect of recent rate spikes, with the potential for even stronger slowing in coming months.”
According to Black Knight, this drop in prices overlaps with an increase in the supply of houses for sales, which rose by 22% over the last two months. However, the supply is still 54% lower than the 2017 to 2019 levels.
“With a national shortage of more than 700,000 listings, it would take more than a year of such record increases for inventory levels to fully normalize,” said Graboske.
