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- Homes in 98 of the largest 100 US markets sold above their historical norms in August.
- Affordability remains strained as the supply of homes for sale stays lows.
- Just two of the largest metros are seeing homes priced at a discount.
A recent report showed that among the 100 largest US metros, 98 of them are seeing homes sell above their long-term price levels.
The August analysis from Florida Atlantic University and Florida International University researchers showed the vast majority of metros are now considered overvalued based on historical price trends, with only two of them selling at a discount.
Among the 10 markets where homes were selling at the highest above their historical average, seven were in Florida, the analysis showed.
Cape Coral, Florida led the way, with homes there selling at a 47.99% premium compared to historical norms. Atlanta, Georgia, Tampa, Florida, and Palm Bay, Florida followed with premiums of 45.74%, 42.81%, and 42.60%, respectively.
In Cape Coral, the researchers listed the expected price for a typical home at $271,013. However, the average price that homes in the area are actually selling for hovers at $401,063.
The housing market is plagued by low inventory, mortgage rates above 20-year highs, and soaring home prices. Conventional wisdom suggests that rising rates should lead to falling prices, though that hasn't happened yet. Now, many Americans are unwilling to move homes or buy a new home due to high mortgage rates, which keeps potential buyers and sellers off the market.
Meanwhile, the share of consumers who think now is a good time to buy a home dropped to an all-time low last month, Fannie Mae data showed.
"Mortgage rates persistently over 7 percent appear to be deepening the malaise consumers feel about the home purchase market," Fannie Mae chief economist Doug Duncan said in a statement. "In fact, high mortgage rates surpassed high home prices as the top reason why consumers think it's a bad time to buy a home, a survey first."
The average rate on the 30-year fixed mortgage is hovering around 7.62%, according to Mortgage News Daily.