Supply and Demand
In most parts of the country, we’re seeing higher than normal housing appreciation and a low inventory of homes for sale. This is causing a stir, and some believe we’re heading down the familiar and dangerous path that led to a bust in the housing market. “Homes are appreciating too quickly” and “people are just settling because there isn’t a better choice” are a few of the more popular phrases we’ve heard.
By definition, supply and demand dictates that the lower the supply, and higher demand, the more people are willing to pay for something. For SunCrest, that means with the current low amount of SunCrest homes for sale, and the steady amount of people looking to buy in the community, home prices are appreciating.
According to the Home Price Expectation Survey — a panel of economists, real estate experts, and market strategists — 50% of the experts cite not enough homes for sale as a primary driver of home values going up. Another 20% believe it’s because interests rates are still at historic lows. Translation: 70% believe limited inventory and low interest rates are causing this push.
We believe there’s a strong third factor: pent up seller demand. Historically, homeowners would stay in their homes an average of 6 years. Since 2007, the number has risen pretty dramatically as the economy struggled, they owed more on their homes than it was worth, and they worried about job security. With those worries somewhat faded, many are looking to finally get out of their current house and into something that better suits their current needs.
Looking back over same period last year (Jan-May), the SunCrest market has improved in several areas:
- Homes are selling quicker. The median days on the market down from 113 to 26.
- Home prices are going up. The median home price is up 4.3%.
- Despite a lower number of home available, 11% more homes have sold this year.
There’s no doubt about it. There is a shortage of SunCrest homes for sale and folks who are ready to buy. While this doesn’t guarantee a quick sale, now’s the time to list if you’ve been on the fence about moving. And with home prices rising, it’s the time to buy before you get priced out.
Our SunCrest Market Update is a hyper-local analysis of the most up-to-date information regarding the SunCrest real estate market. The previous month’s SunCrest housing information and future editions are released monthly.