40 straight quarters of home price growth in the US
According to the latest data from the Federal Housing Finance Agency House Price Index, home prices have increased 17.4% nationally from the same period last year. The Seattle area ranked 25th in the nation with prices up 20.1% since the same period last year. Remember, this quarterly data is already old news--it reflects changes that took place in June.
FHFA sites low inventory and crazy low interest rates as key factors in the rapid price appreciation we are seeing nationally. You've probably seen this graph a few times over the years, but I'll use it again because a picture really is worth a thousand words when it comes to mortgage interest rates over time!
Locally, the summer selling season is winding down and most remaining 2021 sellers are preparing to list their homes in the weeks following Labor Day. We can expect to see a nice batch of new listings in September and October before things taper into the holidays. Here's a look at inventory levels throughout the course of the year. Note that September has been our peak inventory month four out of the last five years!
Inventory may peak again in September, but you can see that inventory levels are down significantly from the previous three years and trending lower. This is not great news for buyers.
The supply of homes for sale over the past 10 years gives useful perspective into why prices have risen so quickly over the past year locally. Demand continues to outpace supply. We need more listings!
Buyers
Keep your head up and jump in when you're ready, but as always, be picky as heck and focus on quality. Your investment will do well long-term if the lot is good and the home's layout works for a broad audience. Don't make a speculative bet on a 1-bedroom house with a spiral staircase, or a condo in an outlying area.
Sellers
Don't expect spring prices, even if the news suggests major tailwinds for sellers. The market is good, but it's not spring anymore and buyers are pickier this time of year. Plan on getting fewer offers than your neighbor who sold in May, and don't skimp on the preparations.
Thanks for reading!