Here are the current market factors that show why sellers are on top.
Are home prices on the decline or will they soon dip? While predicting the future of any market is challenging, there are several indicators suggesting that home prices might not be heading south anytime soon. Let's delve into these indicators.
1. Low inventory. Despite fluctuations in the market and a slowdown in sales, one key factor remains: low inventory. While there has been a slight uptick in inventory levels, the month's supply of inventory still hovers just over three months. Typically, a balanced market sees around six months of inventory. This shortage in supply continues to exert upward pressure on home prices.
"The current market conditions favor sellers."
2. Rental market trends. Another telling sign comes from the rental market, where rates have surged by approximately 30% nationwide. Renting a home has become significantly less affordable compared to previous years. This trend is driving more individuals towards homeownership, bolstering the demand for homes. With high rental rates and low inventory, the conditions favor sellers, making it an opportune time to list a property.
3. Decline in new construction. The dwindling number of new construction homes also plays a pivotal role in maintaining low inventory levels. Prior to the housing crisis of 2007-2008, approximately a million new homes were constructed annually. However, this number has plummeted significantly in recent years. The scarcity of new construction exacerbates the inventory shortage. While there are still some ongoing new construction projects, the overall supply remains constrained, further buoying home prices.
Home values have experienced a modest uptick and show resilience amidst economic fluctuations. Looking ahead to the foreseeable future, there are no indications of impending declines, even with interest rate dynamics. The outlook for 2024 remains robust, offering ample opportunities for those considering selling their homes.
If you're curious about the value of your home in today's market, don't hesitate to reach out to us. We offer complimentary home evaluations and are here to provide insights tailored to your specific needs. Whether by phone or email, we're ready to assist you in navigating the dynamic real estate landscape.