According to a recent MReport, a study revealed nearly all of the cities studied reported an increase in home prices. The National Association of Realtors revealed home prices rose in 96% of metros during Q1 of 2020. Out of the 181 metros studied, 174 reported an increase in sales prices. This is 2% higher compared to the last quarter of 2019. The median single-family home prices have risen by 7.7%. In 2019, the median price was $253,000, compared to $274,600 in 2020. Of the metros studied, 46 of them experienced a double digit increase. The city with the largest increase was Boise City, which saw an increase by 18%. Eugene, Oregon and Colorado Springs, Colorado were the second and third cities.
WHY IS THERE AN INCREASE IN PRICES?
The National Association of Realtors Chief Economist Lawrence Yun believes the jump in prices “reflects conditions prior to the coronavirus outbreak and show the strength of the housing demand prior to the pandemic”. Additionally, Yun stated that because of limited listings, home prices will not change. The strong demand from buyers and a severely limited inventory accounts for the rise in home prices. Yun stated that more houses need to be listed and the economy needs to move forward for the housing industry to recover. In addition, homebuilding needs to resume. Yun ended with this telling commentary on those most poised to buy now: “Mortgage rates are at historic lows and those with secure employment will be attracted to the market.”
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