The latest S&P/Case-Shiller report has been released and it reflects the shifts in the market that we’ve been predicting. As of February 2024, we note that US home prices are persistently rising and at an accelerated pace. We already know this trend continued into March and April, and we’re feeling it intensify as more and more consumers are adopting the “buy then refi” strategy as we’ve been talking about for months.
The inflection point has passed, and the headwinds settle and become tailwinds.
Our current real estate market presents various challenges to both buyers and sellers, including low inventory levels, locked-in sellers, and high replacement costs for new builds. Many speculate that pent-up demand will arrive at the very time of record low supply after the US presidential election, once there is more confidence about various policies that could affect housing demand and migration patterns.
A big consideration for Washington state is the potential repeal of the WA State Capital Gains Tax, which is on the ballot. What will happen if that drops off, and wealth tech stockholders have 7% more equity to play with?
Here’s a more current look at similar information reported by S&P. This is resale of single-family homes in the King, Snohomish, Pierce, and Kitsap Counties:
According to Trendgraphix, we’re looking at a trend of 1.3 months of supply and an average price per square foot rising at more than 1% per month. Consider that this sort of appreciation will help cover the temporary infliction of higher mortgage interest rates. Don’t let FOMI (fear of mortgage interest) give you FOMO (fear of missing out).
For more market news from industry experts and RSIR CEO and President Dean Jones, tune into our podcast series Market Perspectives in audio format here or check out the videos of the interviews here.