Mountain West housing markets may be cooling down
Home prices increased significantly during the pandemic, and markets in the Mountain West saw some of the country's biggest hikes. But now, some cities in the region might see those prices come back to earth.
Real estate analytics company CoreLogic recently released a report on home prices in the U.S. over the last year. It shows that, between August 2021 and August 2022, prices jumped between 15 and 20% in Nevada and Arizona, while the rest of the Mountain West saw increases more in line with the national average of 13.5%.
But that 13.5% is actually the lowest year-over-year appreciation rate since April 2021, indicating a cooldown. CoreLogic sees the Boise and Reno markets as having among the highest chances of price declines over the next year.
Many would welcome a cooldown as an affordability crisis grips much of the region, and while it may help homebuyers generally, for those who need a mortgage, there are other hurdles to overcome.
“In the last few months, the Fed has been raising interest rates,” said Megan Lawson, an economist with Headwaters Economics. “And that's slowing down new home purchases because borrowing costs are just more expensive now.”
She predicts the housing market will slow down in the Mountain West, but not dramatically.
“I think that's in large part because of the strength of our economy, the high quality of life in the communities, and the fact that there's such pent-up demand for housing,” Lawson said.
Lawson also emphasized that although prices may decline somewhat, these prices are historically higher than ever before.
“They're just not increasing at these really eye-popping rates that were catching all the headlines for a while,” she said.
This story was produced by the Mountain West News Bureau, a collaboration between Wyoming Public Media, Nevada Public Radio, Boise State Public Radio in Idaho, KUNR in Nevada, the O'Connor Center for the Rocky Mountain West in Montana, KUNC in Colorado, KUNM in New Mexico, with support from affiliate stations across the region. Funding for the Mountain West News Bureau is provided in part by the Corporation for Public Broadcasting.