Last week we had an unexpectedly large and wonderful number of new listings, with under-contracts at historic normals, which has given us a little more inventory to work with. Nationally, median rents and mortgages have gone up, with rents escalating at a lower rate than mortgages.
Quick Market Recap
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Local Market Update:
Last week, we had 129 new listings, vs 102 in 2018, 102 in 2019, 90 in 2020.
Under-contracts were up at 90. Contrast this with 90 in 2018, 91 in 2019, and 101 in 2020.
Last week we had 1.52 months supply of inventory, vs 1.82 MSI in 2018, 1.50 MSI in 2019, and 1.11 MSI in 2020.
To summarize, our higher number of new listings has replenished housing stock a little, with our under-contracts not being higher than normal. We will keep track to see if this reduction in demand is a trend, but it is likely just a little up and down in demand like we’ve seen repeatedly this year. Keep in mind that our overall yearly under-contracts are currently far higher than the last three years.
Activity By Price Band:
We again saw a super active $1.5mm-2mm price band; this part of the market should feel pretty shopped-out at this point. In contrast, from $2.5mm+ and 0-$500k have had fewer under-contracts, so there are hopefully some good options there.
National News: Median Mortgages and Rents Rising.
Strong demand for both homes and rentals has pushed both median mortgages and median rental rates up.
Demand for household units has gone up right now largely because of young adults and divorcees joining the buyer pool.
Median mortgages have risen higher/faster than median rental rates, according to a number of national indices. When looking at these charts, it is important to keep in mind that they don’t document intangibles such as appreciation and tax benefits.
Whether you’re a move-up buyer or a first-time buyer, it can be tempting to wait on your housing purchase when you see this type of news. Keep in mind that to not lose buying power, your income needs to increase faster than the housing appreciation rate; otherwise, when you return to the market, you’ll likely find that the $750k house you were looking at years ago is now $1mm.
To note, the Federal Housing and Finance Agency recently published that Q1 2021 had a .87% increase, and Q2 2021 had a 7.6% increase, totaling 8.5% total for 2021 thus far. Please keep in mind that the FHFA may adjust these numbers slightly as the year proceeds. We’ve not seen this type of Q1 & Q2 appreciation since 2014/2015.
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