Over the past year, jaws dropped across the country as home prices ballooned. But the housing market now just looks like it was ahead of the curve. The latest Consumer Price Index showed a stunning 5.4% rise in prices across the board in the U.S., which is the fastest pace for thirty years.
Meanwhile, the market that was alleged to have gone completely haywire has started to even out. The Case-Shiller Index shows that home prices posted their smallest monthly gains since July 2020. YoY growth has leveled off, and appreciation dipped even in hot markets like L.A. and the Bay Area.
The period of runaway gains appears to be giving way to a much healthier market; home sales increased by a brisk 7% in September. And the 2022 forecast is good. Fannie Mae expects home prices to rise by 7.9% in 2022. That’s strong growth, without the volatility of the pandemic-era market — or the rapid inflation afflicting the economy at large.