With prices so high and trending higher, when can we expect them to fall?

When will home prices come down in today's real estate market? Given the state of the economy and what we hear in the news, home prices have been at an all-time high, especially over the last four years. Historically, real estate prices went above the normal trend line of 4% appreciation. That's caused some people to question if the market is crashing.

This time is different from 2006 to 2012 when we saw prices go way above the trend line. What's happening now is more of a story of inventory. Looking at what's been happening with inventory these last few years, we have well below normal home inventory levels. Home inventory is driven by how many homes are available for buyers to buy, meaning how many sellers are on the market. Typically, we have a pretty strong baseline of inventory. We’re well below normal inventory levels.

“When you don’t have enough supply for the demand, prices stay strong and high.”

What's causing home prices to be strong and steady, even though the economy still has a lot of uncertainty, is supply and demand. When you don’t have enough supply for the demand, prices stay strong and high. So if you're thinking about waiting for prices to change or come down, know that pricing is going to remain steady. We won't see double-digit appreciation as in the last few years. Still, all market indicators show we will stay steady and stable in pricing due to the low inventory levels.

If you have a question about today's market, reach out to us and start the conversation. Send us an email or give us a call; we'd love to hear from you.