Dive Brief:

• Housing prices could be softening. A new analysis from real estate listing website Trulia found that the number of price reductions for rental listings increased more than 1 percentage point to 9.32% in September 2016 from 7.97% of listings having had their prices cut a year ago. The reductions increased in 80 of the 100 largest U.S. metros during the period.

• Meanwhile, the number of price reductions in for-sale listings grew from 10.14% in 2015 to 10.66% in 2016, with 70 of the 100 largest metros seeing annual increases in price reductions. 

• Price drops in rental listings were most frequent over the last 12 months in San Francisco (21.31%) and San Jose, CA (21.17%). Denver, Houston, Portland, OR and Seattle followed. For-sale listings saw a smaller share of price declines with San Francisco (up 2.84 percentage points), Houston (up 2.84 percentage points), Dallas (up 2.53 percentage points) leading that market.

Dive Insight:

Housing prices have increased steadily in the last five years, rising more than 20% in for-sale and more than 12% in rental properties, according to Forbes.

The National Association of Realtors reported that housing inventory shortages pushed home prices up in the third quarter, with seven of the 10 most expensive residential markets located on the West Coast. San Jose, CA, was cited as the most residential expensive market during the period, with the median price of a single-family home around $1 million. Trulia data on price reductions, however, suggests that the market is softening or has reached a price roof, as landlords and sellers there cut prices in order to make sales or rentals. 

Meanwhile, the U.S. housing market showed signs of improvement during the third quarter, running at 98% of normal economic activity, up from 93% a year ago, according to the National Association of Home Builders/First American Leading Markets Index.

​The U.S. homeownership rate also bounced back slightly from a 51-year-low during the third quarter, as consumers in the market were more likely to be homeowners than renters — a sign of recovery in the market.

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