Are we ‘bubbling’ again?
Home prices are rising at a more rapid pace as demand outpaces supply. Existing-home sales nationally surged 9% year-over-year in March with home prices were up 8% according to the National Association of REALTORS®. What’s more, with tight inventories plaguing many markets, the national median list price in March climbed 11% reaching $220,000.
Realtor.com’s chief economist predicts home price increases will stick because the market is continuing to correct for severe price declines in the recent past. While prices rose 7% and 12% in 2012 and 2013, respectively, over the past three years median prices have climbed less than 8% on a compounded annual basis.
Bottom line: On an inflation-adjusted basis, nationally we are still 30% beneath the peak set in 2005.