House prices fall 3.3 percent - the biggest annual drop since 2012

House prices suffered their biggest annual drop since 2012 as rising mortgage rates deterred would-be buyers from moving. 

The median US property is now worth $400,528, down 3.3 percent from a year ago, according to data from real estate brokerage Redfin. 

Boom towns like Boise, Idaho, and Austin, Texas - which saw values shoot up during the pandemic - underwent the steepest losses. 

Boise saw prices drop by 14.3 percent in the year to March while Austin, Sacramento and San Jose saw declines of 13.7 percent, 11.9 percent and 10.5 percent respectively.

Nationwide buyer activity also plummeted, with the number of pending house sales  26.6 percent down on March 2022 - the lowest since the onset of the pandemic. 

House prices suffered their biggest annual drop since 2012, according to data from brokerage Redfin 

New listings also fell 23.3 percent year-on-year in March. 

But some cities on the East and West coasts have fared better, with Milwaukee, Wisconsin, seeing prices jump by 11.7 percent. 

In El Paso, Texas, home values increased by 11.1 percent, while Omaha, Nebraska, saw prices shoot up 10.7 percent.

It comes after it was revealed mortgage rates had climbed by 6.43 percent - the biggest incline in nearly two months. 

Experts said rising rates - along with ongoing economic uncertainty - was contributing to the dip in activity.   

'I was consistently busy in the fall, but things got really quiet in March after the collapse of Silicon Valley Bank,' said Boise Redfin real estate agent Shauna Pendleton. 

'That killed the buyer momentum that had been building and brought us right back to where we were last year when mortgage rates shot up. 

'There’s this fear that everything will crash. There are bank failures, inflation, recession fears, mortgage-rate volatility, a war in Ukraine, spy balloons—some people are wondering if they should pull their money out of the bank and park it in a safe rather than spend it on a new home.'

The property market exploded during the pandemic as lockdown left homeowners wanting bigger homes with more outdoor space.

And the sudden work from home culture meant office employees no longer needed to live in the big cities - prompting them to flee to coastal areas. 

Prices surged by 26 percent in May 2021, with Boise experiencing an increase of 40.9 percent. 

Experts said rising rates - along with ongoing economic uncertainty - was contributing to a dip in homebuying activity

Mortgage rates rose at their fastest pace in nearly two months, according to the Mortgage Bankers Association (MBA)

Agents in some cities said recent declines was being driven by a lack of housing stock.  

'Low inventory is driving the market and causing bidding wars to intensify. I have two listings that have each received around ten offers in the past few weeks,' said Dan Close, a Redfin real estate agent in Chicago. 

'Buyers’ agents are trying so hard to find homes for their clients that they’re calling me before my listings even hit the market. 

'I did a consult with a seller recently and before we had anything in ink, three brokers phoned to say they’d heard about the home through word of mouth and wanted to know more. 

'We had two above-asking offers on the $2 million home within 24 hours. There weren’t even any photos online yet.'