Media coverage about what’s happening with home prices can be confusing. A large part of that is due to the type of data being used and what they’re choosing to draw attention to. For home prices, there are two different methods used to compare home prices over different time periods: year-over-year (Y-O-Y) and month-over-month (M-O-M). Here's an explanation of each.
The key difference between Y-O-Y and M-O-M comparisons lies in the time frame being assessed. Both approaches have their own merits and serve different purposes depending on the specific analysis required.
We’re about to enter a few months when home prices could possibly be lower than they were the same month last year. April, May, and June of 2022 were three of the best months for home prices in the history of the American housing market. Those same months this year might not measure up. That means, the Y-O-Y comparison will probably show values are depreciating. The numbers for April seem to suggest that’s what we’ll see in the months ahead (see graph below):
That’ll generate troubling headlines that say home values are falling. That’ll be accurate on a Y-O-Y basis. And, those headlines will lead many consumers to believe that home values are currently cascading downward.
However, on a closer look at M-O-M home prices, we can see prices have actually been appreciating for the last several months. Those M-O-M numbers more accurately reflect what’s truly happening with home values: after several months of depreciation, it appears we’ve hit bottom and are bouncing back.
Here’s an example of M-O-M home price movements for the last 16 months from the CoreLogic Home Price Insights report (see graph below):
So, if you’re hearing negative headlines about home prices, remember they may not be painting the full picture. For the next few months, we’ll be comparing prices to last year’s record peak, and that may make the Y-O-Y comparison feel more negative. But, if we look at the more immediate, M-O-M trends, we can see home prices are actually on the way back up.
There’s an advantage to buying a home now. You’ll buy at a discount from last year’s price and before prices start to pick up even more momentum. It’s called “buying at the bottom,” and that’s a good thing.
If you have questions about what’s happening with home prices in the Roaring Fork Valley, or if you’re ready to buy before prices climb higher, connect with Jordie Karlinski, real agent specialist in Aspen, Colorado.
STAY UP TO DATE ON THE LATEST REAL ESTATE TRENDS
Jordie Karlinski | January 8, 2025
Jordie Karlinski | September 17, 2024
Jordie Karlinski | June 24, 2024
Jordie Karlinski | June 21, 2024
Jordie Karlinski | June 20, 2024
Jordie Karlinski | November 6, 2023
Jordie Karlinski | October 30, 2023
Jordie Karlinski | October 27, 2023
Jordie Karlinski | October 25, 2023
Jordie is driven, grounded, committed to her work, and passionate about the long-term success of her community. Through her experiences as a professional athlete, she learned discipline, persistence, planning, and attention to detail.