Still, inflation, which skyrocketed to a 40-year high in June and remained above 8% in August, has squeezed consumers’ budgets.
The Federal Reserve has reacted aggressively by hiking interest rates from near zero at the start of this year to over 3%, raising borrowing costs and driving long-term mortgage rates to the north of 6% for the first time since 2008.
The median existing-home price has plummeted by 6% from a record high of about $414,000 in June, to $390,000 in August, the National Association of Realtors said this month. Moreover, existing-home sales fell for a seventh straight month in August and were down 20% from a year earlier, the trade group said.
Fed Chair Jerome Powell has signaled the US central bank wants to bring down house prices.
“We’ve had a time of a red-hot housing market all over the country,” Powell noted. “The deceleration in housing prices that we’re seeing should help bring prices more in line with rents and other housing-market fundamentals. And that’s a good thing.”
