Six California metros in Black Knight’s bottom 8; three among six losers found by Case-Shiller.
Neither of the valuation math was kind to California.
Six California markets ranked among the worst performers in Black Knight’s tracking of price falls from springtime peaks. Case-Shiller found six down markets nationally for June — three in California. Real estate insiders suggest these may be seasonal dips. But why are the 10 markets with the biggest slips tracked by Black Knight and all six decliners from Case-Shiller located between the Pacific coast and Denver?Simply put, this year’s soaring mortgage rates and rising consumer anxieties have shaken the foundation for the sky-high home prices of the pandemic era — especially in California.7% off the peak .3% off the peak .The other top drops were Seattle , Denver , and Portland and Phoenix .
The typical U.S. house hunter must now put 36% of their income toward house payments, according to Black Knight’s “affordability” index vs. the 25-year average of 24%. So today’s house hunter has one-third less buying power than the norm. “Given the large role affordability challenges appear to be playing in shifting housing market dynamics, the recent pullback in home prices is likely to continue,” says Andy Walden, Black Knight’s vice president for enterprise research.