It’s full steam ahead for housing prices in the second half of 2013 as they continue their upward move. According to the S&P/ Case-Shiller Index, housing prices are moving upward in all of the major cities around the nation.
Fast Moving Prices
And the prices aren’t just inching up, they’re moving in leaps and bounds. They are up by over ten percent in major metro areas and nationwide. Does this sound familiar? That’s because the last time prices increased at this rate was back in 2006, just before the crash.
No other economic sectors are seeing this kind of improvement. Jobs are increasing, but at a very slow pace. Wages are pretty steady with only slight increases in some industries.
Obviously, home sellers are happy to hear this news. It is also good news for real estate agents, builders, home improvement stores, appliance companies, and pretty much anybody else that gets involved in either new-home builds or renovations. Even state and local governments benefit from higher prices, because they get more in property taxes and transaction fees.
As people see an increase in the value of homes, they’re willing to spend more to get more. They will do those kitchen and bathroom renovations that they’ve been putting off. And it’s not just those who are selling their homes. Even those who plan to keep them for a few years see value in increasing the worth of their home. And anyone who works for a home improvement company or construction sees increased calls for work.
What about the Buyers?
This can’t be good news for the buyers, can it? Many experts say it won’t actually hurt buyers as long as they get busy and buy now before interest rates go up too high or house prices move up too far. While many people are concerned about this rate of increase, experts say it’s just moving the housing market back to where it was; when prices dropped so drastically below what they should have been worth.
Many analysts see this increase in price as a simple law of supply and demand. More people want to own their home instead of rent and others want to downsize. There are just not enough homes for the demand. This is good news for builders who can now start increasing the number of houses they can build.
Experts say this is what the economy needs now to continue the recovery process. There will be more jobs available, and more people will be able to buy as lenders reduce their restrictions on borrowers with the improvement in the market.
The areas that are seeing the biggest boom are the places that were hit hardest by the crash. So, while it looks like big numbers, these areas are really just getting back on track to where they should be. And that is good news for everyone, buyers and sellers included.