Supply and Demand driving prices of existing homes up.
We hope everyone had a safe and happy 4th of July!
As most people have come to realize over the last few years, home prices just seem to be on a never ending upward cycle. In June that trend did not change. The median price for an existing home was up 3% from April and 5.2% year over year according to a recent NAR report.
What is the cause of the continued rise? “Supply and demand” – the same concept you learned in school years ago regarding consumer goods or raw materials. This is the primary reason for the continued home price increase. Builders are not building enough new homes and not enough home owners are putting their homes on the market. While home sellers are thrilled that they will most likely be able to sell their home really quickly, they also have to find a new place to live and that can add stress knowing that the home buying environment can be extremely difficult right now. So many have decided to hold off selling their home which has only exacerbated the problem. It seems for the time being we are stuck in a very odd market with no end in sight.