October home asking prices increased marginally from the month before—the second slowest gain in seven months that nonetheless is part of a monthly, quarterly, and yearly trend of gains that are high compared with historical norms, according to the Trulia Price Monitor.
A 0.6% month-over-month increase in October may seem small, but the year-over-year 11.7% increase in asking prices is the highest since the housing bubble burst, says a recent Trulia Trends blog post.
The reason behind the quick rise in asking prices: Buying still looks cheaper than renting, the Trulia Price and Rent Monitors indicate, and inventory remains tight despite an increase from January’s level.
Asking prices weren’t hurt by the federal shutdown that occurred in October, as month-over-month asking price change between the metros more directly affected by the shutdown didn’t notch any difference from other metros.
“The price slowdown in recent months is primarily because of expanding inventory, rising mortgage rates, and declining investor activity,” says Trulia. “In recent months, we could see prices slow further if consumer confidence suffers form the ongoing budget uncertainty and future shutdown and debt-defaul worries.”
Written by Alyssa Gerace