House of the Rising Prices Pt. 2

Our local spring selling season is reflective of the fact that U.S. home prices are on the rise as more buyers chase fewer available properties. 

Standard & Poor’s CoreLogic Case-Shiller national home price index (released this week) increased 5.8% in February, the most in 32 months. Some analysts say such strong price gains and slightly higher mortgage rates may eventually cool demand. For now, sales of new and existing homes are robust. March’s sales of existing homes reached their highest level in a decade. The strong market however, hasn’t enticed more Americans to sell their homes. The number of houses for sale has dropped to the lowest level in nearly 20 years, which makes finding one the toughest challenge awaiting potential buyers in this buying season.

Many homeowners have benefited from the sharp price gains of recent years, but those increases have also made it harder for them to trade-up to a bigger house, discouraging them from selling. Others have very low mortgage rates and may be reluctant to sell if doing so would force them to take on higher borrowing costs. Interesting times…