Judging by the buzz on the streets and media outlets, I’d think the housing market was doing worse than what the actual numbers suggest. It’s possible the current statistics are a warning sign, but on average, properties values haven’t declined much since August.
In August the median Single-family home was $450K
In October it was $445K
What is declining is the number of properties sold and in escrow. Less buyers force sellers to compete for the shrunken buyer pool encouraging them to reduce the list price.
The number of available homes for sale has remained steady over the past few months. Inventory has increased since the summer months, but we haven’t seen an influx of homes for sale. To many homes for sale would contribute to price reductions and plummeting values.
If interest rates increase further, we can expect to see a further decline in home prices. Even if they stay the same, we can expect prices to continue to drop until we find an equilibrium.
Housing affordability is driven by many factors, but the two key inputs are home prices and interest rates. If interest rates are too high, home prices have to come down.
WHAT IS MY HOME WORTH?
Selling your home?
We’re here to help you price it right – get a comparative market analysis today.