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Fitch Ratings estimates national home prices were 7.8% overvalued for the fourth quarter of 2022 on a population-weighted average basis, and Fitch expects that overvaluation will continue to moderate amid ongoing home price declines. Prices dropped 0.5% in January 2023, marking the seventh consecutive month of declines. Fitch estimates home prices in 88% of the country’s metropolitan statistical areas (MSAs) are overvalued. Approximately 52% of MSAs are over 10% overvalued, down from 62% in 3Q22. Among the top 100 most populated MSAs, Buffalo-Cheektowaga-Niagara Falls, NY is estimated as the most overvalued, followed by Rochester, NY and Birmingham-Hoover, AL. Fitch primarily attributes the rebound in existing home sales in February to two factors. First, the decline in mortgage rates from their November 2022 highs has improved affordability, albeit briefly. Additionally, the recent home price decline makes properties more attractive to buyers who may have previously been priced out of the market. Sales could continue to grow at a slower pace as affordability issues and inventory shortages persist. A strong rebound in sales may be temporary with the mortgage rate expected to remain high for a longer period. 

See if you're ready to take advantage of the decline in home prices. All the tools necessary to help you decide can be found at www.mikehomesweethomes.com