Housing price bubble chatter has increased this summer, as market observers
attempt to predict the next residential real estate shift. It is too early to predict a
change from higher prices and lower inventory, but the common markers that
caused the last housing cooldown are present. Wages are up but not at the same
pace as home prices, leading to the kind of affordability concerns that can cause
fewer sales at lower prices. At the same time, demand is still outpacing what is
available for sale in many markets.
New Listings were up 24.9 percent to 1,691. Pending Sales increased 20.8 percent
to 1,375. Inventory grew 11.4 percent to 3,824 units.
Prices moved higher as Median Sales Price was up 5.2 percent to $171,131. Days
on Market decreased 18.8 percent to 52 days. Months Supply of Inventory was up
6.3 percent to 3.4 months, indicating that supply increased relative to demand.
Consumer spending on home goods and renovations are up, and more people are
entering the workforce. Employed people spending money is good for the housing
market. Meanwhile, GDP growth was 4.1% in the second quarter, the strongest
showing since 2014. Housing starts are down, but that is more reflective of low
supply than anything else. With a growing economy, solid lending practices and the
potential for improved inventory from new listing and building activity, market
balance is more likely than a bubble.
Information courtesy of CMLS*