After the pandemic-era boom, the housing market is finally showing signs of a slowdown, as demand for homes has started declining following a combination of high home prices and soaring mortgage rates that squeezed many potential buyers out of the market.
According to Moody’s Analytics’ latest proprietary housing, as reported by Fortune, home prices will rise 0 percent next year—a dramatic decrease from the 19.7 percent growth in prices the housing market experienced in the last 12 months.
But analysts expect price changes to vary significantly across different regions of the United States. In its analysis of the country’s 414 largest housing markets, Moody’s predicts home prices will increase in 183 markets next year, while they will drop in 231 others.
The biggest year-on-year home price jumps in 2023 will happen in the following five cities, according to Moody’s analysts:
- Albany, Georgia (4.12 percent)
- New Bern, North Carolina (4.12 percent)
- Augusta, Georgia (3.84 percent)
- Hartford, Connecticut (3.73 percent)
- Casper, Wyoming (3.29 percent)
On the other hand, the company’s analysts expect home prices to drop the lowest in these areas:
- The Villages, Florida (6.96 percent)
- Punta Gorda, Florida (6 percent)
- Reno (5.57 percent)
- Honolulu (5.56 percent)
- Spokane, Washington (5.52 percent)
The situation appears slightly different in Moody’s forecast for 2024, with these cities expected to report the biggest jumps in home prices:
- Albany, Georgia (5.5 percent)
- Casper, Wyoming (4.52 percent)
- Columbus, Georgia (4.09 percent)
- Rocky Mount, North Carolina (3.97 percent)
- San Jose, California (3.83 percent)
While Albany remains solidly on top of the list and Casper experiences an even higher increase in home prices, Columbus, Rocky Mount and San Jose replace New Bern, Augusta and Hartford in the 2024 ranking.
In general, Moody’s analysts expect more cities to see home price increases in two years than in 2023, with 236 cities experiencing a year-on-year surge, while only 178 regional housing markets are expected to see home prices decline.
The five areas experiencing the steepest drop in home prices in 2024 are topped again by The Villages and Punta Gorda, but there are also cities that didn’t appear in the 2023 list:
- The Villages, Florida (6.33 percent)
- Punta Gorda (5.71 percent)
- Cape Coral, Florida (4.58 percent)
- Lake Havasu, Arizona (4.26 percent)
- Spokane, Washington (4.11 percent)
A slowdown of the housing market will be necessary for the Federal Reserve’s plan to cool inflation to work, though there’s a risk the quick deceleration of the market could turn into a crash.
Experts have so far dismissed concerns over a housing crash similar to 2008, saying the conditions of the market are much more stable and safer than they used to be before the financial crisis.
The post Five Cities Where Home Prices Will Jump Highest in 2023: Analysis appeared first on Newsweek.
