The pandemic caused a strong demand for homes with more space, which led to historically high housing prices. Now, record-high interest rates and inflation are driving buyers to a more affordable alternative: condos.
This shift is making single-family home prices undergo a dramatic price correction across the nation; however, condo prices are contracting much less, indicating the current demand for condos in the U.S.
To discover the price evolution of both single-family homes and condos, Point2 analyzed condo and single-family home prices in the 100 largest U.S. cities from May to the most recent available pricing data. Since last spring, when prices were at a peak, single-family home prices have decreased by 8.6%, while condo prices have only fallen by 4.4%.
Though single-family home prices are falling almost twice as fast as condo prices nationwide, an opposite trend has been seen in Arizona, where condo prices dropped more than single-family homes in the state’s seven largest cities.
Glendale, Ariz. recorded the biggest condo price drop in Arizona of 21% and landed fifth on the top ten cities with the biggest contractions in condo prices since the price peak in May. Mesa and Chandler followed with a 15% price drop and 11% price drop, respectively.
Single-family home prices, however, didn’t drop as drastically. Chandler and Gilbert both dropped the most in the home market, with a 12% decline, while Phoenix followed with a 10% decline. Likewise, house prices in Mesa, Scottsdale, Glendale and Tucson contracted between 5% and 8% compared to their spring peaks.
Read the complete Point2 analyzation of condo and single-home price evolution here.
