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Will home prices finally drop this summer? Here’s what experts say
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When interest rates plummeted during the pandemic and many people reevaluated where they wanted to be in life, a flurry of real estate activity caused home prices to soar. Today, the nationwide average price of a home is $438,601, up significantly compared to the average home price of $298,669 five years ago.
However, some prospective buyers have held off on purchasing new homes due, in large part, to high mortgage rates and low housing inventory. As they wait, many are hoping to at least see home prices drop. But do experts foresee that happening this summer? Here’s what you should know.
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Will home prices finally drop this summer? Here’s what experts say
Here’s what experts have to say about whether home prices are likely to decline over the next couple of months.
Why home prices might not budge much
According to many real estate experts, home prices seem unlikely to decline much, if at all, over the next few months. And if they do drop, it could be more of a seasonality issue, rather than a long-term trend.
“I am expecting home prices to remain steady or decline marginally over the course of the summer, likely less than an average of 1%, very insignificant. This time of the year is historically slow for home sales with people traveling and enjoying their summers rather than home shopping,” says Jared Blumberg, licensed real estate salesperson at Compass.
But even if demand slows a bit, today’s mortgage interest rates aren’t the only factor making the overall cost of homebuying more expensive. Limited inventory is also a big issue, as many potential sellers don’t want to sell their homes and shop for mortgages now, as they could be giving up low mortgage rates for a higher one.
At the same time, if interest rates decrease, then that could cause more buyers to rush in and drive up prices. So, a big part of the equation will likely be the supply vs. demand balance.
“I don’t believe that prices will decline this summer,” says Kevin Leibowitz, founder, mortgage broker at Grayton Mortgage, Inc. “We’re still below the inventory prior to Covid, despite having interest rates that are much higher. Unless we have a substantial spike in inventory, then I don’t see how we will have a price decline.”
Meanwhile, the relatively strong economy puts upward pressure on home prices.
“The strong labor market and continued consumer spending also create a supportive environment for housing prices. Until we see a significant uptick in housing inventory, any potential drop would likely be minimal and/or concentrated in a few localized markets,” says Kelly Misuknas, senior director of capital markets at Better.
As she points out, though, it’s possible that local conditions differ. When you shop for mortgage lenders and houses, it’s important to not get too caught up in the national trends and instead see what’s possible for your situation.
“If you look closely at specific cities, locations, and product types there are amazing deals to be had out there. You just have to know where to look. For example, in Manhattan where I concentrate my business, we are seeing considerable prices drop when compared to the overlying national data,” says Blumberg.
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What could cause home prices to drop?
While many experts do not foresee much likelihood of housing prices falling this summer, it could be worth keeping an eye on certain conditions that could lead to decreases.
“For substantial price drops to occur, we’d need to see a combination of factors, including a significant increase in inventory, lower mortgage rates, and shifts in economic conditions or policy. However, given the current market strength, such a dramatic change seems unlikely in the near term,” says Madison Sutton, licensed real estate salesperson at Serhant.
“In my opinion, things will need to shift starting at the top; the frustrations we’re hearing don’t just affect a singular market. We’re dealing with a nationwide accessibility and affordability issue, if not a crisis, that’s having a psychological and economic impact on homebuyers today as well as generations to come,” she adds.
These changes at the top could involve a mix of monetary and fiscal policy, such as those that affect mortgage rates and inventory.
“The Federal Reserve’s future decisions on interest rates could potentially lead to lower mortgage rates, making homeownership more accessible. However, the Federal Reserve’s indications to cut only once before the end of the year have also caused hesitation among buyers and sellers alike. As we navigate an election year, suggestions of new policies and regulations might emerge that could positively impact the housing market,” says Sutton.
Still, it could be difficult to change the overall supply and demand dynamics.
“Even if mortgage rates decline and inventory increases, there is so much pent-up demand from potential home purchasers that it’s unlikely home prices would decline in a material way,” says Misuknas.
The bottom line
The real estate market seems unlikely to experience significant price decreases nationally this summer, but it’s possible that in specific local markets, there will be dips. Still, until conditions change, like with more housing inventory, it could be tough for prices to decrease. Even then, it could take time for pent-up demand to temper, but it’s possible that overall affordability at least increases, such as if mortgage rates drop.
Bela Karolyi, the charismatic if polarizing gymnastics coach who turned young women into champions and the United States into an international power, has died. He was 82.
A spokesperson for USA Gymnastics confirmed to CBS News by email that Karolyi died Friday. No cause of death was given.
Karolyi and wife Martha trained multiple Olympic gold medalists and world champions in the U.S. and Romania, including Nadia Comaneci and Mary Lou Retton.
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“A big impact and influence on my life,” Comaneci, who was just 14 when Karolyi coached her to gold for Romania at the 1976 Montreal Olympics, posted on Instagram.
The Karolyis defected to the United States in 1981 and over the next 30-plus years became a guiding force in American gymnastics, though not without controversy. Bela helped guide Retton — all of 16 — to the Olympic all-around title at the 1984 Games in Los Angeles and memorably helped an injured Kerri Strug off the floor at the 1996 Games in Atlanta after Strug’s vault secured the team gold for the Americans.
Karolyi briefly became the national team coordinator for USA Gymnastics women’s elite program in 1999 and incorporated a semi-centralized system that eventually turned the Americans into the sport’s gold standard. It did not come without a cost. He was pushed out after the 2000 Olympics after several athletes spoke out about his tactics.
It would not be the last time Karolyi was accused of grandstanding and pushing his athletes too far physically and mentally.
During the height of the Larry Nassar scandal in the late 2010s — when the disgraced former USA Gymnastics team doctor was effectively given a life sentence after pleading guilty to sexually assaulting gymnasts and other athletes with his hands under the guise of medical treatment — over a dozen former gymnasts came forward saying the Karolyis were part of a system that created an oppressive culture that allowed Nassar’s behavior to run unchecked for years.
Still, some of Karolyi’s most famous students were always among his staunchest defenders. When Strug got married, she and Karolyi took a photo recreating their famous scene from the 1996 Olympics, when he carried her onto the medals podium after she vaulted on a badly sprained ankle.
Despite losing his boxing match to Jake Paul, Mike Tyson in a social media post Saturday said he had “no regrets” to getting “in ring one last time.”
The boxing legend was defeated by social media star Jake Paul in a highly anticipated fight on Friday night with an age difference of over three decades between the two contenders.
Netflix said Saturday that 60 million households worldwide tuned in to watch the match. The two fighters went eight full rounds, with each round two minutes long. Paul defeated Tyson by unanimous decision and the 27-year-old upset boxer and 58-year-old former heavyweight champion hugged afterward.
Paul was expected to earn about $40 million from the fight, and Tyson was expected to take around $20 million for the fight, according to DraftKings and other online reports.
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Tyson said on his social media that “this is one of those situations when you lost but still won. I’m grateful for last night.”
The fight almost didn’t happen after Tyson experienced an ulcer flare-up while on a plane in March. He addressed his illness Saturday, writing that he “almost died in June.” He said he had eight blood transfusions and “lost half my blood and 25lbs in hospital and had to fight to get healthy to fight so I won.”
Tyson retired from boxing in 2005 after a 20-year career. He last fought in a 2020 exhibition match against former four-division world champ Roy Jones Jr.
“To have my children see me stand toe to toe and finish 8 rounds with a talented fighter half my age in front of a packed Dallas Cowboy stadium is an experience that no man has the right to ask for. Thank you,” he said.
Alex Sundby and
contributed to this report.
In their final meeting, China’s leader Xi Jinping told U.S. President Biden that his nation was “ready to work with a new administration,” as President-elect Donald Trump prepares to take over.
The two leaders gathered Saturday on the sidelines of the annual Asia-Pacific Economic Cooperation summit. Mr. Biden was expected to urge Xi to dissuade North Korea from further deepening its support for Russia’s war on Ukraine. It marked their first in-person meeting since they met in Northern California last November.
Without mentioning Trump’s name, Xi appeared to signal his concern that the incoming president’s protectionist rhetoric on the campaign trail could send the U.S.-China relationship into another valley.
“China is ready to work with a new U.S. administration to maintain communication, expand cooperation and manage differences so as to strive for a steady transition of the China-U.S. relationship for the benefit of the two peoples,” Xi said through an interpreter.
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Mr. Biden, meanwhile, spoke in broader brushstrokes about where the relationship has gone and reflected not just on the past four years, but on their long relationship.
“Over the past four years, China-U.S. relations have experienced ups and downs, but with the two of us at the helm, we have also engaged in fruitful dialogues and cooperation, and generally achieved stability,” he said.
Mr. Biden and Xi, with top aides surrounding them, gathered around a long rectangle of tables in an expansive conference room at Lima’s Defines Hotel and Conference Center.
There’s much uncertainty about what lies ahead in the U.S.-China relationship under Trump, who campaigned promising to levy 60% tariffs on Chinese imports.
Bobby Djavaheri, president of Los Angeles-based Yedi Houseware Appliances — which manufactures its products in China — told CBS News in an interview this week that such tariffs “would decimate our business, but not only our business. It would decimate all small businesses that rely on importing.”
Trump has also proposed revoking China’s Most Favored Nation trade status, phasing out all imports of essential goods from China and banning China from buying U.S. farmland.
Already, many American companies, including Nike and eyewear retailer Warby Parker, have been diversifying their sourcing away from China. Shoe brand Steve Madden says it plans to cut imports from China by as much as 45% next year.
White House national security adviser Jake Sullivan said Biden administration officials will advise the Trump team that managing the intense competition with Beijing will likely be the most significant foreign policy challenge they will face.
It’s a big moment for Mr. Biden as he wraps up more than 50 years in politics. He saw his relationship with Xi as among the most consequential on the international stage and put much effort into cultivating that relationship.
Mr. Biden and Xi first got to know each other on travels across the U.S. and China when both were vice presidents, interactions that both have said left a lasting impression.
“For over a decade, you and I have spent many hours together, both here and in China and in between. And I think we’ve spent a long time dealing with these issues,” Mr. Biden said Saturday.
But the last four years have presented a steady stream of difficult moments.
The FBI this week offered new details of a federal investigation into Chinese government efforts to hack into U.S. telecommunications networks. The initial findings have revealed a “broad and significant” cyberespionage campaign aimed at stealing information from Americans who work in government and politics.
U.S. intelligence officials also have assessed China has surged sales to Russia of machine tools, microelectronics and other technology that Moscow is using to produce missiles, tanks, aircraft and other weaponry for use in its war against Ukraine.
And tensions flared last year after Mr. Biden ordered the shooting down of a Chinese spy balloon that traversed the United States.
