May 28 2018
It's no news to real estate pros: trends point to the continued appreciation of home prices. What does this mean for sales?
The Mortgage Bankers Association's Chief Economist noted a lack of listings in the housing market is driving prices higher. Despite already high prices, bidding wars are not uncommon.
American wage growth is being left far in the rearview, with home prices increasing at staggering levels twice that of income growth. On an annual basis, wages are growing just 2.6 percent, with a less than expected 0.1 percent rise in February. Stubbornly stuck, lackluster hourly earnings have been well-documented on government employment reports.
To add insult to injury for income-strapped buyers, national home prices have risen 6.2 percent annually, based on the most recent S&P CoreLogic Case-Shiller survey, to levels now 6 percent higher than their peak before the housing crisis.
A housing shortage continues to constrain the market, with the absolute number of units on the market nearing record-low levels. Though home buyers have tried to step up the pace, new homes are not filling market shelves fast enough. And this insatiable demand is horrifyingly happening before the peak of Millennials entering the housing market.
In current market conditions, the fact that mortgage rates are at around four-year highs isn't offering much relief. Those hoping rising prices are among passing real estate trends are out of luck.
The wave of increased housing demand is expected to continue, bolstering steady growth and affecting the economy over the next four to five years. The supply crisis is not letting up, and neither are gains in home values.
To view the original article, visit the Properties Online blog.