Almost every real estate sale revolves around the continuous rise in house values over the last four years. Some have even mentioned a concern about another possible bubble forming. However, the recent increase in prices can be attributed to a very simple principle: supply and demand.
Demand for single-family housing has continued to increase dramatically as the economy moves forward. Recent surveys have shown that over 80% of each generation still believes that home ownership is a part of the American Dream. And a recent Gallup Survey showed that Americans believe that real estate is the best long-term investment.
Last week I placed two houses under contract. One took 24 hours until offer acceptance and the other 48 hours!
Over the last several years, many homeowners were unable to put their homes on the market due to finances, and/or limited equity in the home. There has been a pent-up supply of sellers who have wanted to sell and move but simply couldn’t. Now many will be able to.
Below is a graph depicting the number of years families have historically stayed in a home. We can see there is pent-up seller demand based on this chart.
As the economy improves and more families reach the point of significant equity (20% or more), we will see these homes come to market. As supply then matches demand, the acceleration of home price increases will begin to slow down. Therefore this so called bubble should correct itself simply and the housing market will roll on with slow steady growth which is ultimately what we all want.
For potential home sellers; get a free home evaluation to see if you are able to sell from a financial perspective. If you are one of the families that have been chained to your current home over the last 5-7 years, now may be the time to break free and find the home of your dreams. To get the value of your home for Free please click here
For potential home buyers; you will be able to actually take more than a few hours after leaving a showing to decide if you would like to make an offer on a house before you lose it to someone else willing to pay full price in a matter of minutes.
The opinions expressed here within are my own completely independent of BHGRE Coccia Realty and its owners and subsidiaries.
Thinking of buying or selling a home? Contact me for a Real Estate consultation. My information is below. I look forward to hearing from you.
Raymond Ciampaglia, Realtor®
Better Homes and Gardens Real Estate | Coccia Realty
424 Valley Brook Ave | Lyndhurst, NJ 07071
Office: (201)939-8900 | Fax: (201)939-8910
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