Uptick in Bay Area Home Prices Will Slow Down

Home Prices Will Slow Down

Look for the frantic run-up in home prices to settle down in the coming months, as real estate markets in the Bay Area and the nation move closer to more-normal levels of activity.

A report on August home and rental prices, published by Trulia, gave three reasons for the predicted slowdown: rising mortgage rates, a  larger supply of  inventory, and declining investor demand.

Mortgage rates have risen more than a full percentage point since early May, Trulia noted, while figures from the National Association of Realtors show an increasing availability of homes for sale–a result of more owners regaining equity in their properties as prices rise. The growing prices, meanwhile, have put a damper on investors’ interest in real estate as fewer bargain properties enter the market.

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