In metro areas across the United States, home prices are rising. According to the National Association of Realtors, in 93% of the nation’s 176 major metro areas, home prices are up year-to-year in the second quarter of 2015. These price increases, which were in double digits in nearly 19% of the major metro areas, are results of huge demand and dwindling supply in the real estate market. The housing market is in an inventory crunch.
“Steady rent increases, the slow rise in mortgage rates, and stronger local job markets fueled demand throughout most of the country this spring,” says NAR Chief Economist Lawrence Yun. “While this led to a boost in sales paces not seen since before the downturn, overall supply failed to keep up and pushed prices higher in a majority of metro areas.”
Unfortunately, these huge, widespread jumps in price are causing affordability problems. People across the US who are currently renting or are trying to enter the market as first time or seasoned buyers are having trouble because homes are becoming so expensive.
Year-to-year, there was 8.2 percent increase in the average national median price of a single family home in the second quarter. The national median price is currently $229,400.
“The ongoing rise in home values in recent years has greatly benefited homeowners by increasing their household wealth,” says Yun. However, “inequality is growing in America.”
According to the NAR, it would take annual earnings of $49,195 to buy a home at the national median price with a 5 percent downpayment.
While these high prices may look discouraging, builders are working in high gear to meet demand in the housing market right now. These rising trends however will continue until construction truly catches up, and therefore there is no better time than today to purchase your dream home in the Miami area. If you are considering buying a piece of property, look no further than RE/MAX Paradise and contact one of our awesome agents today! 