Home Prices Are Finally Falling—Here’s How Buyers Can Capitalize on a Market Slowdown

Median home list prices are still up 13.3% year-over-year, but as a growing number of sellers offered concessions to make sales in October, home prices fell from June’s record high of $449,000 to $425,000, Realtor.com reports. Cooling home prices could offer winter buyers a window of opportunity, but skyrocketing mortgage rates continue to keep a large share of house hunters out of the game, even as inventory rises and sellers become more open to negotiating.

Not only are prices falling, but homes are also lingering on the market for far longer than they were during a mid-pandemic homebuying boom. The typical home spent 51 days on the market in September, 20 days longer than in May, and that sharp slowdown could lead to even more price cuts in the months ahead.

So why would skyrocketing mortgage rates drive down home prices? Because many buyers simply can’t afford those heftier monthly payments. Some no longer qualify for loans. Others—also contending with high inflation and a harsh economic landscape—have simply given up their home search, at least for now.

“We know that buyers in today’s housing markets are facing significantly higher costs—with the monthly mortgage payment for the median listing-price home up nearly $1,000 per month,” says Hale. “Many buyers cannot navigate the housing market in the face of these higher costs.”

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