What’s Up with Real Estate?
National news and local views for the week ending Friday, May 12, 2023
National Real Estate News
Inflation is fading
Both the price inflation seen by companies (PPI: 2.7% -> 2.3%) and the price inflation seen by consumers (CPI: 5.0% -> 4.9%) dropped again in April. Look how much progress we've made compared to the peaks (11.6%, 8.9%) set in 2022! With producers able to pass on lower costs to consumers, and housing rental cost growth finally slowing, headline CPI should drop below 4% over the next few months.
Rates will follow inflation down
Bonds and the Fed hate inflation. As inflation eases, the Fed will certainly stop raising rates, and may need to start cutting rates (especially if the economy begins contracting). That's great news for hopeful buyers as lower mortgage rates will make homebuying more affordable AND increase the supply of homes for sale (because fewer sellers will feel 'locked in' by their current low-rate mortgages).
Supply scarcity
The number of active listings nationwide has risen 48% in the last year (Yeah!) But it's still down 50% from 4 years ago (Boo!) Demand is rising, but the pace of new listings year-to-date is running 28% below last year. Active inventory would normally be rising in April, but instead it was flat at 564,000 units. This supply shortage explains why home prices are rising again.
Local Market Trends
As of Friday, May 12, 2023
| Area | Median Price | Active Listings | New Listings - 5 days | Median Days on Market |
|---|---|---|---|---|
| 33308 | $582,500  -0.1% | 352  0.1% | 26 | 55 -0.1% |
| 33323 | $549,825  0% | 100 0.1% | 6 | 49 0.1% |
/) from Apr. to May. 2023.
