The median US home price fell nearly 2% year-over-year in April, the National Association of Realtors said.
That’s the sharpest drop since January 2012.
The housing market slowdown comes as soaring mortgage rates push away would-be buyers.
US home prices just logged their biggest annualized drop in over 11 years, with soaring mortgage rates driving a slowdown.
The national median existing-home price slumped 1.7% to $388,800 last month, according to data from the National Association of Realtors – the metric’s biggest year-on-year drop since January 2012.
Median prices have now fallen 6% from their peak of $413,800 last June.
The slump comes amid a rapid rise in mortgage rates, with the average 30-year fixed-rate mortgage climbing from 5.25% to 6.35% over the past year, according to data from Freddie Mac.
That has likely weighed on demand by making homes less affordable for most buyers, and discouraging people locked in at lower mortgage rates from selling their houses.
Mortgages have become more expensive over the past year due to the Federal Reserve’s aggressive interest-rate hikes.
The central bank has lifted benchmark borrowing costs from near-zero to over 5% over the past year in a bid to bring down soaring prices – and while inflation appears to be cooling and moving closer to the Fed’s 2% target, that’s weighed heavily on certain stocks, as well as bonds and housing.
There was also a sharp drop in sales activity alongside the slump in prices, with total completed transactions for existing homes falling 3.4% between March and April and over 23% year-on-year.
The slowdown was particularly felt in the western half of the US, with prices still rising in much of the east.
Read more: US commercial real-estate prices just fell for the first time in 12 years – and are likely to drop further, Moody’s warns
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