There are a number of elements at play that affect the housing market – these statistics fluctuate daily and vary based on which are of the country you are in. Below is an update on a few of these fluctuating contributors.
Nationally, home prices have risen 6.6% when to last year, according to a home price index released Wednesday from data provider CoreLogic. Based on CoreLogic’s findings, prices rose 1.2% from April to May.
Simultaneously, the rent for single-family rose 3.1% for the year in May, while rental costs in the affordable single-family rental segment of the market (including properties with rents less than 75% of the regional median) grew 4.7%.
While this increase in home prices and rental rates is helping current owners bolster their equity, it is also blocking out renters and buyers who are not able to afford steeper prices.
Keep in mind that these statistics are nationwide and the impact varies by state. In California, there was 5.8% increase..meanwhile, in Wyoming, prices dropped 2.2%. For a full recap of home price increases/decreases, check out this article by Realtor.com
Mortgage rates declined to their lowest level in 2017 during the last week of June. The rate for a 30-year mortgage fell to 3.88%, down from a week earlier when it averaged 3.9%. This rate is much higher than last year’s rates, which averaged 3.48%.
In theory, these lower mortgage rates could make help to make homes more affordable, but the inventory off available homes has also dropped. According to the The National Association of Realtors Pending Home Sales Index, which provides a forward-looking indicator of housing demand, tumbled 0.8% in May. This is the third consecutive decline.
A labor shortage has been one of the housing industry’s biggest challenges over the past five years. A lack of workers slows the construction process homes and apartments which has helped contribute to the housing shortage. According to Realtor.com (sourced from Labor Department Data),the number of open construction jobs has fallen to a “seasonally adjusted 154,000 in May, down from the cyclical high of 238,000 open jobs set in July of last year.” Hopefully this decrease is due to a saturated work-force, as opposed to a decline in the overall number of housing projects.
For a full recap on the South Bay market or for personalized price analysis for your home, never hesitate to contact the Weber Accetta Group!