We are the 52nd highest-ranked Metropolitan Statistical Area in the nation, with regard to percent change in house prices (they’ve gone up). The PDF is at the Office of Federal Housing Enterprise Oversight’s site.
The statistics are pretty amazing. Over a 5 year period, housing prices have increased almost 70%!
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Is a 70% increase in prices over five years a good thing in your opinion?
Short answer to the above – yes, for those who have been fortunate enough to purchase. There are many, many people who have been able to “trade up” one or two (or three) times in this period. For them, the increase has been great.
For my clients who are looking at homes in the $200k (and below) range, absolutely not. They have been virtually priced out of the market, or are forced to compete furiously to get a house that requires a fair amount of work and/or is simply not suitable for them/their family.
There are so many reasons that I think the dramatic increase in values is not necessarily a “good thing”. First and foremost, many of my clients have to settle for less than they normally should. No first-time homebuyer is going to get the “perfect” house, but I strive to help them find the “right” house. Today’s prices make that much more difficult. Second, there are too many Realtors who think this profession is “easy money,” who are untrained and do a disservice to my chosen profession and most importantly and too often sadly, their clients. Third, and last, for today, I think this increase in values is unsustainable, and that is being evidenced by the increasing “days on market” statistic. As I have said before, we need to reevaluate our expectations with regards to the housing market and begin to look again at houses as “homes.”
In summary my opinion is yes and no, depending on one’s perspective. Personally and professionally, the 70% increase in prices has been simply “ok.” When I see townhouses selling today for what single-family homes nearly twice as large were selling for early last year, I think something is a bit askew.
By the way, I love your site and read it every day.