May 13, 2013
HARRY’S “SPECIAL EDITION”
News So Good It Just Couldn’t Wait
EXTRA! EXTRA! EXTRA! EXTRA! EXTRA!
I WANTED YOU TO BE THE FIRST TO KNOW….
This is such positive Residential news that I couldn’t wait until the next eNewsletter to share it with you.
National Association of Realtors (NAR) has just published the “Median Sales Price of Existing Single Family Homes for Metropolitan Areas.” The reported average median sales price gain of the 150 largest communities in the U.S. was 11.3% over the same time period last year. These figures from NAR are calculated from every closed sale listed in the MLS within these areas.
Colorado Springs has experienced a median sales price gain of 13.1% for that same time period. I have always liked to use the words “relative strength” to compare a house, a neighborhood, price ranges, sales, etc. The fact that our local market has appreciated by about 16% better than the average of the 150 largest communities in the USA shows that the Colorado Springs population is more confident in home ownership than in many other cities nationwide.
What this tells us is:
- With the increase in demand for homes and the supply of listings greatly reduced, the basic expectation is that our home values and prices will continue to increase.
- Sellers are receiving a higher price for their homes and Buyers are agreeing to pay more today vs. one year ago.
- Now is a great time to upgrade to the home you have been wanting. Many people have been waiting to make a move to a better neighborhood because the former marketability and value of their existing home may not have been at a reasonable selling price.
- Buyers are taking advantage of the still historically low mortgage interest rates, not knowing how long they will last.
- This appreciation has also been a terrific gain to Homebuilders as homeowners now have the equity available to build.
The NAR survey comparisons are produced approximately 6 weeks after the end of each calendar quarter. Since this only compares the First Quarter 2013 to last year’s same time period, we already know that our local market conditions continue to escalate even through last month, April 2013. And from where I sit, I can honestly say I haven’t seen this kind of Residential activity locally in a good number of years and it just keeps getting busier.
Friday’s Wall Street Journal stated that “home prices in metropolitan areas saw their biggest year-over-year gains in more than seven years in the first quarter, evidence that the housing recovery is spreading across the nation.”
The article went on to say that “the NAR’s quarterly report is a good measure of general price trends, but the results can sometimes overstate the magnitude of price gains because they don’t control for shifts in the number of homes sold in various price categories. As a result, the median price can rise sharply if sales of higher-end homes increase faster than sales of lower-priced homes.”
And according to Lawrence Yun, NAR chief economist, many areas in the USA are experiencing a Seller’s market. “The supply/demand balance is tilted toward Sellers in a good portion of the country,” he said. “Inventory conditions are expected to remain fairly constrained this year, so overall price increases should be well above the historic gain of one-to-two percentage points above the rate of inflation. If homebuilders can continue to ramp up production, then home price growth is expected to moderate in 2014.”
NAR President Gary Thomas said that conditions also remain favorable for Buyers. “Even with rising home prices, there is still plenty of buying power in the market,” he said. “Historically low mortgage interest rates and home prices that remain well below their peak mean most Buyers can purchase well within their means, assuming they meet ongoing stringent credit standards.”
I have been providing this Quarterly data from NAR to our readers for many years and do not recall a gain like this recently published quarter, in our local market, since we first created our eNewsletter!
To view the entire NAR Quarterly Report and see how the rest of the country is doing in comparison to our local market, please click here.
If you have any questions concerning this report or how the current market is affecting you personally, please call me at 598.3200 or email me at Harry@HarrySalzman.com .