Home Prices in Metropolitan Regions Jump 5.7% As Inventory Idles Near All-Time Low Levels

The National Association of Realtors (NAR) released their quarterly report on Metropolitan Median Prices and Affordability.  The report which you can read here shows that national median home prices for single family homes increased 5.7% from $245,500 from $232,200 from the same quarter in 2017.  The report which the NAR releases every quarter shows price data for single-family residences for approximately 175 Metropolitan Statistical Areas (MSAs).
The lack of inventory of housing fueled faster appreciation according to NAR.  Lawrence Yun, chief economist for NAR states:

“The worsening inventory crunch through the first three months of the year inflicted even more upward pressure on home prices in a majority of markets. Following the same trend over the last couple of years, a strengthening job market and income gains are not being met by meaningful sales gains because of unrelenting supply and affordability headwinds.  Realtors in areas with strong job markets report that consumer frustration is rising. Home shoppers are increasingly struggling to find an affordable property to buy, and the prevalence of multiple bids is pushing prices further out of reach.”

Overall, home prices last quarter increased in 91 percent of the markets that NAR takes statistics from.  They note that 162 out of 178 metropolitan statistical areas were showing sales price gains for the quarter in comparison the the same quarter in 2017.  Thirty percent of all metro area (53) saw double-digit increases which was up from 15 percent in the fourth quarter of 2017.

Another factor that is affecting affordability is rising mortgage rates.  The national family median income rose to $74,779 in the first quarter yet mortgage rates are wiping out any increase to an individuals' income.  Yun added “Prospective buyers in many markets are realizing that buying a home is becoming more expensive in 2018.  Rapid price gains and the quick hike in mortgage rates are essentially eliminating any meaningful gains buyers may be seeing from the combination of improving wage growth and larger paychecks following this year’s tax cuts. It’s simple: homebuilders need to start constructing more single-family homes and condominiums to overcome the rampant supply shortages that are hampering affordability.”

Of note here in the Northeast the report shows that existing-home sales decreased 8.5 percent in the first quarter.  The median existing single-family home price in the Northeast was $267,400 in the first quarter which is an increase of 4.6 percent from the same quarter in 2017.

Blue Harbour Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

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