According to the National Association of REALTOR’s ® (NAR’s) latest metro affordability report, the national median existing single-family-home price honed in on $279,000 in Q2 2019, an increase of +4.3% y/y.
Single-family-home prices rose in 162 of the country’s 178 metros, or 91% of those metros. Over 50% of the metros saw median home prices rise +5% y/y.
Lower inventory and a need for new construction is a recipe for such increasing home prices as well as more competition. Lawrence Yun, chief economist with NAR, said, “New home construction is greatly needed, however home construction fell in the first half of this year. This leads to continuing tight inventory conditions, especially in more affordable price points…home prices are mildly reaccelerating as a result.”
Higher priced metros were among the few metros to see home prices decline. Take a look:
- San Jose and Santa Clara saw home prices decrease -5.3%
- San Francisco and Oakland saw home prices decrease -1.9%
- Honolulu saw home prices go down -1.2%
Take a look too at the five lowest priced metros nationally:
- Decatur IL
- Youngtown OH
- Cumberland MD
- Binghamton NY
- Elmira NY
Even though the national median income rose to $78,362 in Q2, home price growth outpaced that income growth.
Again, Yun, “The exceptionally low mortgage rates will help with housing affordability over the short run. But if the low interest rates are due to weakening economic confidence, as reflected from a correction in the stock market, the low rates will not help with job growth and will eventually hinder home buying and home construction.”
Thanks to Patrick Kearns of InmanNews for source material.