Earlier this week we got more positive news for real estate from Case-Shiller about home price. Let’s compare their numbers to data from Upstate South Carolina…
Earlier this week we got more positive news for housing and the economy. While it is about home prices for the entire US and not just Upstate South Carolina, let’s look at the data from the most recent S&P/Case-Shiller Home Price Index (HPI) for May 2013.
The Case-Shiller HPI is based on a three-month rolling year-over-year average of home prices. According to Case-Shiller, home prices increased in all 20 cities they track. US home prices grew by 12.20% on a year-over year basis in May. This is even better than the previous months 12.10% year-over year increase. On a seasonally-adjusted month-to-month basis, home prices rose by 1.00% in May 2013 from the level in April 2013.
Look at home prices in Upstate South Carolina from the Market Reports:
I must mention this for house prices for the entire WUAR MLS so while it is more relevant to us, it still is not what you need to make an informed decision when buying or selling a home in Upstate South Carolina. But it does show us the general trend that things are getting better in our area when we compare June 2013 to June 2012.
The Take Away:
As you see above, I used more up to date numbers for our area than Case-Shiller. You need to understand that Case-Shiller HPI is always behind by a couple of months behind current market conditions. Also these numbers are from before the recent spike in mortgage rates. We probably won’t see the effect of higher mortgage rates on the Case-Shiller HPI for several months.
Some people are worried that higher mortgage rates could lead to slower home sales. Right now, I am not too worried about this. Think back to how bad the real estate market was after the housing bubble burst. If the home sales do fall because mortgage rates are higher, it could lead to home prices decreasing. Just basic supply and demand stuff.
The real take away is that home prices have been increasing. And so have mortgage rates. Which means buyers could be missing out on a great opportunity. You can deny it all you want but the truth is that both home prices and mortgage rates are still super low.
So if now is the right time for you to buy a home, why would you wait for higher home prices and/or mortgage rates?