Home Price Highs: Comparing National & Local Trends
Sep 02, 2023
Home prices are a mixed bag. ๐คทโ๏ธ
On one hand, higher home prices are generally cheered on by the real estate community and homeowners.
On the other, they mean that it's more expensive to buy a house and can limit the number of purchases.
Regardless of how we judge it, we have to track them and keep our clients updated so they know what is happening and can make a informed decisions. ๐
By the way - if you want to learn how to use this type of information with clients more effectively, check out my newly released class to get help.
Let's take a look at home prices in more detail.
Summertime Home Price Highs
There's been a number of home price index updates published this past week.
In general, the major players include Case-Shiller, FHFA, CoreLogic, Black Knight, & Freddie Mac to name a few.
As a reminder, a home price index is a way to track price growth, but it doesn't necessarily equate to a specific price. ๐ฎ
For example, they set the price for January of 2000 (or any date they pick) as 100. If the index is currently at 300, it means that prices are 3 times the price of January 2000.
That said, I charted the Northeast Florida MLS average sold price for Jacksonville and the Case-Shiller National Home Price Index to compare.
The national index is flat year-over-year while our average sale price in Jax was slightly higher in June.
We have the ability to look ahead in Jacksonville with more recent data available and can see prices continued to rise in July - making all-time highs. ๐คฏ
You Have to Go Local
While Jax and the national average price are similar, here's an example on how different your local market can be from the national average.
I'm likely preaching to the choir on this one, but take a look at the top 20 metro markets compared to the national average.
You can see a perfect example of why averages can blur the whole picture.
Half the top 20 markets are up on the year and half are down.
While valuable for context, the national numbers generally offer little insight otherwise. ๐
What It All Means
One of the topics we review in our coaching sessions is seasonal trends.
We can look at history and map out where the market is likely headed most years (barring a pandemic ๐ฆ , debt crisis ๐ฃ, or money printing party at the Fed ๐ฐ๐ฅณ).
What we find is that historically, home prices peak in June in Jacksonville. ๐๏ธ
Interestingly, they've continued to grow into July, but I expect we've most likely put in the top in prices for the year.
Homes for sale are up slightly, but we never really got the Spring/Summer inventory boost we're used to.
Expect a tight market to remain through the rest of year while we likely drift slightly lower on average sale price.
This can present buyers with an opportunity to get a "deal" compared to Summer prices. ๐ก
Remember, there's not a good or bad market.
Every market is filled with opportunity if you're looking for it. ๐
Go find the opportunity!
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