Rising interest rates may have slammed the brakes on would-be home sales this year, but sellers aren't budging on asking price. In fact, in the majority of metro markets, new data from the National Association of Realtors (NAR) shows, home sale prices are actually higher than they were at this time last year.
The national median purchase price for a single-family home — excluding new construction homes — jumped to $398,500 in the third quarter of 2022, an 8.6% increase from a year ago.
Borrowing is also more expensive these days. In 2021, interest rates hovered at 3% for most homebuyers — today, rates are trending above 7%.
"The median income needed to buy a typical home has risen to $88,300 – that's almost $40,000 more than it was prior to the start of the pandemic, back in 2019," NAR chief economist Lawrence Yun said in a statement.
Some parts of the country saw higher year-over-year increases than others. Home prices in the South were nearly 12% higher compared to 2021, with large swaths of Florida seeing prices 18% to 24% higher than the year before. In the Midwest, home prices jumped a comparatively paltry 6.6%.
Here are the cities with the biggest year-over-year housing price increases, according to the group.
- North Port-Sarasota-Bradenton, Florida (+23.8%)
- Lakeland-Winter Haven, Florida (+21.2%)
- Myrtle Beach-Conway-North Myrtle Beach, South Carolina-North Carolina. (+21.1%)
- Panama City, Florida (+20.5%)
- Deltona-Daytona Beach-Ormond Beach, Florida (+19.6%)
- Port St. Lucie, Florida (+19.4%)
- Greenville-Anderson-Mauldin, South Carolina (+18.9%)
- Kingsport-Bristol-Bristol, Tennessee-Virginia (+18.8%)
- Tampa-St. Petersburg-Clearwater, Florida (+18.8%)
- Ocala, Florida (+18.8%)
Where prices are expected to fall
In the third quarter of 2022, a typical family needed a qualifying income of at least $100,000 to afford a 10% down payment in a whopping 59 metro areas, according to NAR.
The upside, NAR says, is that home prices in some of these areas may begin cooling soon.
"The more expensive markets on the West Coast will likely experience some price declines following this rapid price appreciation, which is the result of many years of limited home building," Yun said in the statement.
Here are the markets NAR predicts will see prices drop in the near future (and the current median home price of each).
- San Jose-Sunnyvale-Santa Clara, California ($1,688,000)
- San Francisco-Oakland-Hayward, California ($1,300,000)
- Anaheim-Santa Ana-Irvine, California ($1,200,000)
- Urban Honolulu, Hawaii ($1,127,400)
- San Diego-Carlsbad, California ($900,000)
- Los Angeles-Long Beach-Glendale, California ($893,200)
- Boulder, Colorado ($826,900)
- Naples-Immokalee-Marco Island, Florida ($746,600)
- Seattle-Tacoma-Bellevue, Washington ($741,300)
- Boston-Cambridge-Newton, Massachusetts-New Hampshire ($698,900)