Home Prices Up 6.54% Across the Country!

Keith Kreis
Published on December 19, 2017

Home Prices Up 6.54% Across the Country!

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Some Highlights:

  • The Federal Housing Finance Agency (FHFA) recently released their latest Quarterly Home Price Index report.
  • In the report, home prices are compared both regionally and by state.
  • Based on the latest numbers, if you plan on relocating to another state, waiting to move may end up costing you more!

The Real Reason Home Prices are Increasing

There are many unsubstantiated theories as to why home values are continuing to increase. From those who are worried that lending standards are again becoming too lenient (data shows this is untrue), to those who are concerned that prices are again approaching boom peaks because of “irrational exuberance” (this is also untrue as prices are not at peak levels when they are adjusted for inflation), there seems to be no shortage of opinion. Home Buying Checklist

However, the increase in prices is easily explained by the theory of supply & demand. Whenever there is a limited supply of an item that is in high demand, prices increase. Home Buying Checklist

It is that simple. In real estate, it takes a six-month supply of existing salable inventory to maintain pricing stability. In most housing markets, anything less than six months will cause home values to appreciate and anything more than seven months will cause prices to depreciate (see chart 1). Home Buying Checklist

The Real Reason Home Prices are Increasing


Where Are the Home Prices Heading in the Next 5 Years?

Today, many real estate conversations center on housing prices and where they may be headed. That is why we like the Home Price Expectation SurveyHome Buying Checklist

Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts, and investment & market strategists about where they believe prices are headed over the next five years. They then average the projections of all 100+ experts into a single number. Home Buying Checklist

The results of their latest survey:

Home values will appreciate by 4.4% over the course of 2017, 3.4% in 2018, 2.8% in 2019, 2.7% in 2020, and 2.8% in 2021. That means the average annual appreciation will be 3.22% over the next 5 years. Home Buying Checklist

Where Are the Home Prices Heading in the Next 5 Years?


3 factors that may impact the sales price of your home

You can make all the necessary repairs to your home, clean it, stage it, maybe even remodel it. But there are some factors that may impact the eventual sales price of your home that are out of your control. So, regardless of how impeccably you’ve maintained the home and despite its ideal location, one or more of these circumstance may rear its head and dash those dreams of riches at the closing table. Home Buying Checklist

Let’s take a look at three of the factors that may impact your home’s value.

1. The condition of the current market

You’ve no doubt heard real estate markets referred to as buyers’ sellers’ or balanced markets. A buyers’ market occurs when there are lots of homes for sale and few buyers competing for them. Since the buyer is in the driver’s seat, prices tend to stagnate or fall in this type of market. When the inventory of available homes is tight and there are many buyers seeking homes, we are in a sellers’ market and home prices rise. Ask Keith Your local Agent about Home Buying Checklist

So, what creates these micro-markets? Many factors affect both national and local housing markets, chief among them is the strength of the economy. When times are good, consumers have money to buy homes and home prices typically increase. In tough times, when unemployment is high and incomes stagnant, the real estate market will feel the pinch. Home Buying Checklist

Then, there are interest rates. When they rise, many are priced out of the housing market and when they fall, folks clamor to buy homes. Therefore, the overall strength of the economy may help dictate the eventual sale price of your home.

3 factors that may impact the sales price of your home

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Home Prices Up 6.54% Across the Country!
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