Median Home Prices Just Fell for the First Time in a Decade

After 12 consecutive months of declines, existing-home sales rose 14.5% month over month in February to a seasonally adjusted annual rate of 4.58 million, the largest monthly gain since July 2020, the National Association of Realtors reports. 

Ending a decade of year-over-year increases—the longest streak on record—home prices fell 0.2% year-over-year to $363,000 last month. Though prices remain historically high and total existing home sales were still down 23% compared with a year earlier, February’s small but significant recovery means that homebuyers are beginning to take advantage of gradual rate drops, and that could signal a healthier market ahead in 2023. 

But February’s uptick is a hopeful sign that the housing market is adjusting to mortgage rates that are nearly double what they were a year ago. Many home buyers are still sitting on the sidelines ready to make a move. “Conscious of changing mortgage rates, home buyers are taking advantage of any rate declines,” says NAR Chief Economist Lawrence Yun. “We’re seeing stronger sales gains in areas where home prices are decreasing and the local economies are adding jobs.”

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