U.S. housing prices fall for 1st time since 2012, but monthly sales rise after 12-month slide


The median price for U.S. existing homes fell 0.2 percent in February from a year earlier, to $363,000, the National Association of Realtors said Tuesday, marking the first year-over-year decline in home prices since February 2021. February's prices were down 12.3 percent from a record high in June, but that doesn't necessarily mean a break for prospective homebuyers because mortgage rates have risen at the same time in tandem with the Federal Reserve's inflation-fighting interest rate hikes.
"Many economists expect home prices to keep falling this spring," The Wall Street Journal reports. "But home-buying affordability is likely to remain worse than it was a year ago, because prices would have to drop significantly to fully offset the increase in mortgage rates. The inventory of homes for sale remains below normal levels, which could prevent steep price declines."
The slight decrease in interest rates and home prices did help reverse a 12-month slide in existing home sales, which make up the majority of the housing market, the National Association of Realtors said. Sales of previously owned homes rose 14.5 percent in February from January, though they were down 22.6 percent from February 2022. The February sales data reflects what buyers and sellers were doing in December and January, well before the recent pair of bank failures rattled financial markets and, possibly, consumer sentiment.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
The slump in home sales and prices is not just a U.S. phenomenon — property prices have also dropped in Britain, Germany, the Netherlands, Canada, and Australia, The New York Times reports — "but few places have been hit as hard as Sweden, which features an incendiary mix of high levels of household debt and the widespread use of variable or short-term fixed rates on home mortgages loans." Housing prices shot up in Sweden during the COVID-19 pandemic, as they did in the U.S. and elsewhere, the Times says, but Swedish house prices have fallen 15 percent from their peak last March through the end of the year "and have mostly plateaued since then."
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.
-
July 13 editorial cartoons
Cartoons Sunday's political cartoons include new TSA rules, FEMA cuts, and Volodymyr Zelenskyy complimenting Donald Trump's new wardrobe
-
5 weather-beaten cartoons about the Texas floods
Cartoons Artists take on funding cuts, politicizing tragedy, and more
-
What has the Dalai Lama achieved?
The Explainer Tibet’s exiled spiritual leader has just turned 90, and he has been clarifying his reincarnation plans
-
Dollar faces historic slump as stocks hit new high
Speed Read While stocks have recovered post-Trump tariffs, the dollar has weakened more than 10% this year
-
AI is creating a luxury housing renaissance in San Francisco
Under the Radar Luxury homes in the city can range from $7 million to above $20 million
-
Economists fear US inflation data less reliable
speed read The Labor Department is collecting less data for its consumer price index due to staffing shortages
-
Tariffs were supposed to drive inflation. Why hasn't that happened?
Talking Points Businesses' planning ahead helped. But uncertainty still looms.
-
Crypto firm Coinbase hacked, faces SEC scrutiny
Speed Read The Securities and Exchange Commission has also been investigating whether Coinbase misstated its user numbers in past disclosures
-
Starbucks baristas strike over dress code
speed read The new uniform 'puts the burden on baristas' to buy new clothes, said a Starbucks Workers United union delegate
-
Exurbs: America's biggest housing trend you haven't heard of
Under the Radar Northeastern exurbs were the nation's biggest housing markets in 2024
-
Warren Buffet announces surprise retirement
speed read At the annual meeting of Berkshire Hathaway, the billionaire investor named Vice Chairman Greg Abel his replacement