From late 2023 to early 2024, we've observed that home prices have remained steady during the low volume months, with new listings and closed sales decreasing as expected for the season. There is still noticeable competition in the market due to low inventory.
The National Association of Realtors reports that 2023 saw the lowest sales volume in the past 30 years, largely due to a significant rise in interest rates. This led to a mortgage lock-in effect: home owners with 'better' loans hold onto their homes for longer periods.
Despite the high interest rates, median home prices have continued to rise year over year, except in the North East region of the country. The majority of population growth is occurring in the South. As noted by Dr. Elliot Eisenberg, if you draw a line drawn from D.C. to S.F., growth is happening below the line.
States such as Texas, Florida, and Idaho have experienced the highest population growth, putting tremendous pressure on their housing. The cost of construction has been rising, builders are refraining from constructing entry-level homes due to lack of profitability. This will continue to have a negative impact on the supply of entry level homes.
Income levels are not keeping pace with inflation, and the overall rate of saving is only half of what it was before the Covid-19 pandemic. Inflation has led to increased costs across the board, increased spending leads to rising default rates on auto loans and credit cards. Many experts are anticipating a mild recession in the horizon.
My goal is to bring genuine care, outstanding real estate services, and significant value, in order to positively impact our communities and clients.