By the Numbers

For anyone who has been desperately trying to purchase a home anytime in the last three years, this recent dip in home prices might have you feeling celebratory. In September, the national median list price for homes in the U.S. fell to $427,000. That number is down nearly 5% from the Summer’s all-time high of $449,000. When you’re talking hundreds of thousands of dollars, 5% spells a big savings in your monthly payment. 

Or Does It? 

This price drop doesn’t mean you should be popping bubbly just yet. In a cruel twist of fate, it’s somehow more expensive to buy a cheaper home at this point in 2022 than it was earlier this year. How does that even happen?! We shouldn’t be paying attention to JUST the home price, but also interest rates. 

“Buyers are getting a seasonal break in pricing,” says Realtor.com Chief Economist Danielle Hale. (Because, traditionally, September is the best month of the year to buy.) However, “with mortgage rates going up, it may not feel like you’re getting a deal.” 

That feeling is due in large part to mortgage interest rates breaking 7%, more than double the 2.9% interest rates of September 2021. Many would-be homebuyers are priced out of the market entirely and those that are sticking around are facing a nearly 80% increase in their monthly mortgage payments than if they’d bought this time last year. 

Because the market has shifted so wildly, this has put some aspects of homebuying back into the buyer’s power. No longer are we seeing homes sell without inspections or other contingencies. With fewer buyers on the market, the buyers that do exist have more say in the process. 

As Hale says, “The market is moving in a buyer-friendly direction, but still has a long way to go.”