The Balance Today: News You Need To Know on Aug. 23, 2022

Sales of new homes dropped 12.6% in July from the month prior, as higher mortgage rates and high home prices continue to weigh on the U.S. housing market. Home sales in July were 29.6% lower than last year, according to the latest report from the Census Bureau released this morning. The decline was more than economists had expected.

Declining home sales and new-home construction have led some experts to say we are in a “housing recession."

But will this mean that, if you’re interested in buying a home, you’ll snag a deal? Not necessarily. While sales of homes are plummeting, home prices aren’t dropping at the same rate. The average price of homes sold in July was nearly $550,000, up more than $80,000 from the average home price last year, according to the Census Bureau.

While mortgage rates have been on the rise, interested home buyers have been getting a small break lately. The average rate on a 30-year fixed-rate mortgage currently sits at 5.13% according to Freddie Mac, and while that’s much higher than the 2.86% that buyers could have scored last year, it’s declined from 5.81% in June.

Still, a housing “recession” could bring some good news if you’re trying to buy a home. While homeowners can receive high prices for their homes, a slowdown in sales could mean that you, as a buyer, will have more leverage to get homes at a more affordable price.

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