The U.S. median home price continued to post double-digit appreciation in May and reached a record high of $380,000, realtor.com® reports. But the rate of price growth has shown signs of slowing for the second time in 13 months (15.2% year-over-year in May compared to 17.2% annually in April), realtor.com®’s Monthly Housing Trends Report shows.

Prices have been rising due to high buyer demand and a lack of inventory. Inventories are less than half the total number of homes for sale on the market compared to a year ago.

“Home buyers looking to lock in still-low mortgage rates face fierce competition for fewer homes for sale than last year’s historic pandemic lows, pushing up the typical asking price in May to an all-time high for the fourth consecutive month,” said Danielle Hale, realtor.com®’s chief economist. “The good news is that price momentum may be beginning to cool off.”

“While still in double-digits, May was the first non-weather related slowing in price appreciation since April 2020,” Hale added. “And with a normal, summer seasonal peak in home prices expected this year, we could see growth fall back to a more normal single-digit pace in the fall.”

Larger metros may post a slowdown sooner than other markets. The largest metros, for example, reported lower annual price gains than the national rate and also had some of the largest numbers of new homes added to the market, realtor.com® reported. The nation’s 50 largest metros had a 12.4% increase in new listings compared to a year ago. The largest gains were in Buffalo, N.Y. (up 64.3%); Philadelphia (up 52.5%); and Washington, D.C. (up 48.9%).

Overall, among the 50 largest U.S. metros, the largest list price increases in May occurred in Austin, Texas (+32.2%); Riverside, Calif. (+21.5%); and Las Vegas (+18.5%).

Real estate pros have increasingly been using drones to capture aerial photos and videos of their listings or even the interiors. New Federal Aviation Administration rules may even allow for greater use too.

The FAA has recently eased some restrictions and expanded some drone rules by authorizing operations at night as well as over people and over moving vehicles. A new “Window to the Law” video—produced by the National Association of REALTORS®’ legal team—shares how this could expand drone use among real estate professionals.

However, the timelines vary as to when some of these new rules take effect.

For example, FAA’s new Remote Identification Rule will not go into effect until Sept. 15, 2023, to allow drone operations over people. It requires drones to transmit identifying information about the drone and its operator. This would be accessible by law enforcement agencies to identify any unsafe operations. Many newer drones will have a built-in remote identification broadcast function.

FAA’s Operations Over People and at Night Rule, which already took effect March 16, may open real estate pros up to capturing aerial twilight photos and videos of their listings. Certified drone pilots who have completed an updated initial test or an updated recurrent online training regimen will now be able to fly drones at night. The drone must include flashing anti-collision lights.

“These are exciting changes that generate more opportunities for drones to create impactful and creative marketing, but it’s important that you are familiar with the FAA’s rules, as well as any state or local laws that may impact your operation before your next drone operation,” Katie Garrity, associate counsel at NAR, says in the Window to the Law video.

Drone operators must have a pilot certification and be ready to show it upon request. Also, the FAA’s rules in 2016 added requirements and limitations on drone operations, including weight, altitude, and speed limits.

Real estate pros who hire a drone operator to capture photos or videos of their listings will want to ensure the company has insurance coverage and the flyer has a current and up-to-date pilot certificate. Learn more requirements to protect your brokerage against liability in The Window to the Law video.

The challenges to build a home continue to mount for the nation’s builders. Material shortages—such as for lumber, appliances, windows, and doors—are at the tightest levels in history, the National Association of Home Builders reports.

About 90% of builders recently surveyed across the country reported shortages of appliances, framing lumber, oriented strand board, plywood, and more, the survey shows. The shortages have worsened over the past year when fewer than 40% of builders reported a decrease in building products and materials.

The latest building material shortages are increasing building timelines and prompting a delay in construction. It’s also leading to higher prices.

National Association of Home Builders

Some home buyers are seeking their pets’ feedback as they tour homes for sale. Twenty percent of 1,000 U.S. adults surveyed by Ally Home in April said they bring their pets to look at homes. Women are more likely to bring their pet with them on a house hunt than men—24% versus 15%, respectively.

“Purchasing a home is one of the most significant investments most Americans will make in their lives, so it makes sense that we want our four-legged friends to feel at home,” said Glenn Brunker, president of Ally Home.

Indeed, a survey conducted by the National Association of REALTORS® in 2020 found that 43% of households would be willing to move to better accommodate their pet.

In Ally Home’s survey, nearly a quarter of respondents—24%—say that having a dedicated space for pets is a major consideration when organizing a home.

Millennials most commonly said that pets influence their home decisions—including not just choosing a home but making changes to a home for a pet, creating a dedicated space for the pet, or even buying a bigger bed to accommodate the pet.

Pets aren’t the only ones influencing home renovation projects, however. During the pandemic, more Americans have become more interested in remodeling. Thirty-one percent of women and 24% of men say they spend a lot of time fantasizing about renovations.

“The time spent at home helped us reevaluate what matters most in our living spaces,” Brunker said. “This awareness helps first-time home buyers more confidently navigate today’s competitive real estate landscape to find a home that fits their lifestyle.”

As home remodeling increases, the EPA is warning remodelers to take special precautions in older homes and watch out for lead-based paint violations.

Lead-contaminated dust from chipped or peeling lead-based paint in homes built prior to 1978 is one of the most common causes of elevated blood levels of lead in children, according to the U.S. Environmental Protection Agency.

Lead-contaminated dust from chipped or peeling lead-based paint in homes built prior to 1978 is one of the most common causes of elevated blood lead levels in children, according to the U.S. Environmental Protection Agency. Even low levels of lead in a child’s blood can result in behavior and learning problems, slowed growth, and hearing problems.

Home remodeling has surged since the pandemic as more homeowners have sheltered in and looked to spruce up their places. According to the Joint Center of Housing Studies of Harvard University, the home remodeling wave is expected to continue to increase in 2022.

Renovations occurring in homes built prior to 1978, which may be at risk of having lead-based paint, may require extra precautions. Lead dust can occur when lead-based paint deteriorates or is disturbed, according to the EPA. “And with more kids spending more time in the home during the COVID-19 pandemic, their risk of exposure to lead chips and dust may increase,” the EPA notes in a statement. About 3.6 million American households have children under six who live in homes with lead exposure hazards, according to the EPA.

Identifying and mitigating exposure in any renovation is critical, the National Association of Home Builders warns on its site. For example, during the renovation, ducts need to be properly covered. Improper removal or disturbance of lead-based paint can generate lead dust and paint chips and pose a health hazard.

Homeowners doing a repair, renovation, or painting project in a home or apartment built prior to 1978 should hire an inspector to determine whether lead-based paint is present and ensure the work is done safely. Homeowners could also consider hiring a certified lead-safe contractor.

How to Tell if a Home Has Lead Paint

Buyers Eye Older Homes for Affordability, Historic Charm

The EPA’s Lead Renovation Repair and Painting Program rule aims to protect the health of the occupants of a home and remodelers. Homeowners and remodelers will want to use lead-safe practices when lead-based paint is assumed or confirmed to be at the residence. An EPA inspection—either of remodeling records or of the active job site—will require documentation on compliance with the RRP rule as well. You can view the inspection manual here.

The EPA recently fined eight residential home remodeling businesses for violations of federal lead-based paint regulations.

“Reducing exposure to lead-based paint, especially among children, is a top priority for EPA,” Ed Kowalski, director of EPA Region 10’s Enforcement and Compliance Assurance Division, said in a statement. “The Agency is committed to ensuring that home renovators follow the law and protect people from exposure.”

Fannie Mae will launch RefiNow this week, which could help lower-income homeowners save hundreds of dollars a month on their mortgage payments.

The program, which begins June 5, aims to help about 2 million homeowners lower the interest rates on their mortgages. Eligible homeowners could save an estimated $100 to $250 a month, according to the Federal Housing Finance Agency, Fannie Mae’s regulator.

Among the eligibility requirements, homeowners must earn 80% or less of their area’s median income to apply. Borrowers also must have a Fannie Mae–backed mortgage (use the loan lookup tool to find out). Borrowers must be current on their mortgage and have no missed payments in the last six months. The mortgage also can’t have a loan-to-value ratio above 97%, and borrowers’ FICO credit scores must be at least 620.

“Lower-income borrowers typically refinance at a slower pace than higher-income borrowers, potentially missing an opportunity to save on housing costs,” says Malloy Evans, senior vice president and single-family chief credit risk officer at Fannie Mae. “Fannie Mae’s new RefiNow option will help homeowners refinance by removing some of those barriers, improving affordability, and promoting sustainable homeownership.”

Under the program, participating lenders would be required to reduce eligible borrowers’ interest rate by at least one-half of a percentage point. That could be higher, however. Lenders also must waive the adverse market refinance fee for borrowers whose loan balance is no more than $300,000. Lenders must provide a credit of up to $500 if the borrower is ineligible for an appraisal waiver.

Lenders aren’t required to participate in RefiNow.

Freddie Mac will start its own refinance program later this summer.