Home Prices Are Falling in These Markets, but Rising Insurance Costs Are Eating Into the Savings

Homebuyers across the country are learning the hard way: The price of a home and the price of living in it aren't the same thing.The national median listing price fell 1.4% year over year in September, the 11th consecutive month of annual declines, according to Realtor.com® data. In the Northeast, prices fell 3.8%.All else being equal, those declines should offer some much-needed breathing room for buyers trying to make the monthly math work. But all else isn't equal.“Even if falling prices lower the monthly payment, that saving can be offset by rising costs such as insurance, HOA fees, and taxes,” says Jiayi Xu, senior economist at Realtor.com.One of those costs has been climbing particularly fast.The average single-family mortgage holder now pays a record $209 per month for property insurance, according to ICE Mortgage Technology. That's an 8.7% jump compared to a year ago and, according to ICE, a nearly 80% leap since the 2020.“The cost of home insurance is an important part of housing affordability, because it is a recurring payment that lenders usually escrow into the monthly mortgage payment,” Xu says.Insurance alone now accounts for 9.6% of the average mortgage holder's mont...