Nationally Price Reductions Jumped by 74% in May from April, and by 69% from May last year, in a sudden and massive U-turn from the very low levels last year and earlier this year.
Price reductions in our Coastal Markets in Pinellas County are trending up as well. 32% of sellers of residential listings with a current status of available or pending contract have reduced their list price.
To put things in to perspective; consider the price of Sold residential properties in our Coastal Markets is up 18% from a year ago and up a staggering 53% from 2 years ago.
Mortgage Rates Surge on Inflation Expectations
After little movement the last few weeks, mortgage rates rose again on the back of increased economic activity and incoming inflation data. The housing market is incredibly rate-sensitive, so as mortgage rates increase suddenly, demand again is pulling back. The material decline in purchase activity, combined with the rising supply of homes for sale, will cause a deceleration in price growth to more normal levels, providing some relief for buyers still interested in purchasing a home.
