LOCAL REAL ESTATE REPORT
With the inauguration finally behind us, many of us are hopeful for the future. Yet still -- the danger of Covid-19 is ever-present, and that will likely extend into summer if not farther. This has been an awful time of stress and worry - and worse – and I pray that it gets better for us all soon. So before I begin, let me extend my best wishes to all you -- for your health and happiness in the new year.
With this report, I’ll provide some relevant data and share my opinion about the current local real estate market. I’ll also share my thoughts about the immediate future. Next week, I’ll follow up with some facts about “housing affordability.” (Teaser – Affordability is not just about prices.) Given the low interest rates, homes may actually be more affordable now than they were in many years past.
The Current LOCAL Real Estate Market –
Here are two important things to know, as evidenced by these two graphs:
1 -- Values have been rising steadily for more than five years.
2 -- Pricing is seasonal.
Comparing the details in these two graphs,* we see a steady rise in
Average Price Per-Square-Foot from $207 in December 2015 to $246 in December 2020.
Yet in each year, you see pricing peaks in May/June/July and pricing dips in Oct/Nov/Dec.
*Note: these pricing stats are for closed properties, which means these actual sales took place six to eight weeks earlier than posted. The graph on the left shows data-points averaged over 12 months, while the graph on the right shows the same data averaged over three month intervals.
One obvious follow up question: Will values continue to rise?
My answer is YES. For my reasons, please see my previous post,
Long-Term Versus Short-Term Value.
A second thing to recognize is that New Listings are beginning to come on the market at a rate not seen since the height of the 2015 listing peak. These three charts below tell a compelling story:
As I detail in my previous post -- home values (and consumer appreciation in general for "single-family homes with a yard") have steadily gone up despite wide fluctuations in inventory.
Meanwhile, total and average numbers of closed sales have been reasonably steady since 2012.
The Takeaway -- We are not experiencing a "housing bubble" that is about to burst. Rather, we are seeing the natural and normal increase in values expected for a progressive northern metropolis that is experiencing significant population growth.
Next week -- Affordability
New Article: Multiple offers & Housing Affordability