Prices continue to increase and break records as strong demand collides with low supply.
Dear friends and clients,
Home price growth has accelerated in the past year as buyers frantically competed for a limited number of houses on the market. Prices continue to increase and break records as strong demand collides with low supply. Sales of new and existing homes have remained about the same in the past few months, mainly due to those sky-high prices.
Peter Boockvar, chief investment officer at Bleakley Advisory Group said, “We have a major affordability issue, especially for the first-time buyer, that is only partly mitigated by low mortgage rates.” It’s not “major” in our area, but it is getting harder for first-time homebuyers. About half of houses sold are still closing above the original listing price. The median existing home sales price in June rose 23.4% from June 2020, the National Association of Realtors reported.
“There’s probably some sticker shock happening out there,” said Hilla Sferruzza, chief financial officer at Home Builder Meritage Homes Corp. However, experts predict home price growth to slow by the end of the summer, as the availability of new listings helps relieve some of the pressure brought by competing buyers. In June, Lawrence Yun, NAR’s chief economist said, “Home price growth will steadily moderate with increased supply, but a broad and prolonged decline in prices is unlikely.”
With home supply slowly improving, those considering selling may want to get their houses on the market sooner rather than later to get the best price.
The current housing market is being driven by three main factors. First, millennials are now the largest generation in the country, and they’re enlarging their families and buying homes. “We anticipate that millennials will continue to lead homeownership demand,” said Odeta Kushi, deputy chief economist at First American Financial Corp.
Second, mortgage interest rates have been falling again the past few weeks, and low rates also continue to drive vigorous home-buying demand. Third, May’s data shows that the U.S. real estate market is also still being driven in part by reactions to the pandemic, as many buyers move from urban apartments to suburban houses.
In the homebuilding sphere, many builders are capping sales to manage their costs and make sure they don’t sell more homes than they can build as high demand persists.
If you’re interested in knowing your home’s value in the present market based on recent Upstate sales, enter your address here to find out what your home is worth right now.
If you have any questions about our market or are thinking about buying or selling, don’t hesitate to call me at (864) 985-1234 or email me at email@example.com. I’m out in the market every day helping clients to buy and sell, and I do research so I have the best advice to give you, no matter your situation.
Your Friend in Real Estate,