It’s been a rough ride for a long time in the real estate market, but as we peek in the rear view mirror, we can see that almost all parts of the country have completed the recovery. Home values are up. Home sales are up. Distressed sales (foreclosures and short sales) have fallen dramatically. It seems that 2016 will be remembered as the year we drove out of the real estate darkness.
The only hiccup in the system is lack of inventory. It’s everywhere. While buyer demand keeps rising, there is not enough supply to keep up.
Doug Duncan, Chief Economist at Fannie Mae says, “Several factors point to constrained housing affordability in 2016, particularly for first-time home buyers, including slow single-family supply response and limited inventory of starter homes on the market.”
The accompanying charts will clearly illustrate the change.
Chart #1 shows a decline in the entry level over the last five years, while more expensive homes have increased.
Chart #2 clearly shows an overall reduction in listings over the last ten years.
Chart #3 gives the list price per square foot and indicates that we have almost totally recovered from the 2006 boom market.
The bottom line is that this is all good news for sellers. Demand for your house will be strong at a time when there is very little competition. That could lead to a quick sale for a really good price.