Twin Cities Housing Market Cooling Down!
As many of our past articles have stated, buying a home in the current market can be difficult, and we aren't the only ones stating this. However after a long six year rise in home prices, we may have finally hit the plateau for the pricing.
As we all have waited for so long to hear, the housing market may actually be cooling down, allowing room for purchasing and an increase in the market capabilities for our current and future generations. This sliver of hope has risen from the monthly indicators. The indicators that we speak of is referencing the median price for homes which in July was $268,000 which is up about 6% from July of 2017. Now that may not give hope to home buyers, however this next bit of information will. While the median price has risen, the inventory for homes over the past year has dropped more than 13%! As a result of this positive change in the market, we are starting to see more sellers in the sellers’ market, opening more room for change and up-trading.
To further help understand this change, the shift from last year to this year when selling in the market has resulted in a $20,000 gain, resulting in more profit for those in the selling mood. This is a great foreshadow, as we have people who want to sell, and can gain better prices for their homes, we will see people who are ready to purchase a home trade-up and get the money moving again.
Some professionals are predicting that we will see a great shift in the market sometime soon, due to past experiences. As the prices have been rising for homes and interest rates, it is inevitable that a correction will occur and result in a dropping of prices and a shift of "unaffordable" into the "affordable" category. Thus far, it has been somewhat irregular for a housing market to grow so much, however a longer growth could hold potential for a larger balance.
A major factor pointing to future potential is the slowing of sales prices, and the current plateau of housing prices, while in some cases the prices have actually dropped. If you imagine it as a roller-coaster, the peak of the ride would be where we currently are, and as time progresses the ride will go down the tracks, until it balances out to ground level, resulting in prices that are more affordable for the current population.
We sure hope this future comes sooner rather than later, but as always we need to keep a keen eye on the deciding factors!
Kontor Realty Group
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