Your inside source for real estate, development and construction information serving the counties of Mecklenburg, Union & Iredell VOLUME 107 NUMBER 27 ■ MECKTIMES.COM
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Housing market slowdown across U.S. starting to affect upscale and western markets more than others ATTOM has released a Special Housing Impact Report spotlighting how the recent downturn in the U.S. housing market is starting to affect counties around the nation, based on key measures from the first quarter of 2023. The report shows that the Western region and other more-upscale areas around the country are bearing the greater brunt so far from the slowdown, than other parts of the U.S., with larger-than-average declines in home values or increases in underwater mortgage rates and foreclosure activity. In contrast, lower-priced markets across the country have experienced relatively less impact from the market downturn that started in the middle of last year. The patterns during the first quarter of 2023 – based on changes in home price, home affordability, underwater mortgages and foreclosures since the second quarter of 2022 – revealed that almost half of the 50 counties seeing the biggest impact were in the West. Among the top 50, 12 were in Oregon and Washington. The downturn also has dented markets more often in areas where median home values exceed $350,000. As with the West, those more-upscale areas had almost half of the 50 most-affected counties during the first quarter of this year. At the other end of the spectrum, the South, Midwest and Northeast were seeing less fallout along with lower-priced markets. States in those regions, led by Texas, Connecticut and Illinois, had 18 of the 50
counties showing the smallest effects from the pullback that hit last year after a decade of nearly unceasing gains in prices, profits and other key measures. “We are starting to see some patterns that show where the U.S. housing market is cooling off and how its hitting homeowners based on some key metrics. It looks so far—and it’s important to stress, so far— to be having more impact in places with the highest housing costs and less impact elsewhere,” said Rob Barber, CEO at ATTOM. “This doesn’t mean those markets are in danger of a big fall while others are immune, but the data does provide a useful geographical snapshot of the initial market dip.” Counties were considered more or less affected by the market slowdown based on changes from the second quarter of 2022 to the first quarter of 2023 in four measures: median home prices, the percentage of homes facing possible foreclosure, the percentage of average local wages required to pay for major home ownership expenses on medianpriced homes, and the portion of homes with mortgage balances that exceeded estimated property values. The conclusions were drawn from an analysis of the most recent reports on each topic prepared by ATTOM. Rankings showing the most and least impacted markets were based on a combination of those four categories in 572 counties around the United States with sufficient data to analyze in the first
quarter of 2023. Counties were ranked in each category, with the overall conclusions based on a combination of the four ranks. See below for the full methodology. The new trends reflect a period when the U.S. housing market endured three straight quarters of flat or negative performance for the first time in more than a decade, as prices, seller profits and homeowner equity fell in most of the country while foreclosure activity rose. That happened as average home-mortgage rates doubled to more than 6 percent for a 30-year fixed-rate loan, inflation was as high as 9 percent, the stock market faltered, and economic uncertainty increased, even amid a period of historically high employment. Interest rates have stabilized, inflation has eased, and the stock market has improved in recent months, generating potential positive signs for the Spring and Summer buying seasons. As with past ATTOM reports on potential downturns, the gaps in the impact from the market drop-off do not suggest significant problems for housing markets anywhere in the nation. What they do show is different impacts in different local markets. Western counties and high-priced markets feeling more impact from market slowdown Twenty-three of the 50 U.S. counties considered most affected by U.S. housing
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