Higher Home Values Means Better Economy 1

home values riseIt appears that the latest unofficial strategy to raise home prices is working. Redfin reports that average home values are rising due to one simple thing – no one is selling.

Since July of last year there are now 28.1% less homes for sale. This trend is expected to continue through the end of the year which should keep prices climbing for a while.

I’m sure you can imagine the next step in this little saga. Prices will rise to a certain level where a whole crowd of people will surge forward with dreams of selling. A flood of new properties will hit the market, demand will be met and exceeded, and prices will start to head down.

Of course, this is part of a normal trend for the most part. But what’s unusual here are the extremes. We haven’t seen a sustained up-trend like this in a while, and if people are holding off on selling in this market it could mean that more folks are meeting their expenses, including mortgage payments. Let’s hope that indicates something positive for wages and employment.

So I’ll keep my eyes on the numbers as they come out, but I want you to comment here and confirm my hunch. Do you think your local economy is going better? Or how about just you? Are you more secure, is bill time a little less stressful? We’re all here for each other so share your stories with our community.

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One thought on “Higher Home Values Means Better Economy

  • Jim Eisberg

    This may just prove that people are still listening to Realtors. I tell all my clients that this is a good time to buy, but not to sell unless you have to. Moreover, the banks are so busy making no-risk profit on dollars they deposit in the Federal Reserve Bank that they have no incentive to lend it to anyone who actually needs the money. So we are returning to land contracts and other forms of seller financing. I think prices dropped so far that they went below bottom, and are climbing back up to replacement value, which should be the absolute bottom.
    Meanwhile, wages aren’t going to rise until all the money stops going to CEOs and overseas, and until anti-trust and support of unions become government goals–which is not likely to happen under Repulicrats, Democans, Libertarians or Occupiers. A global market means that wages will finally stabilize at whatever a Chinese ex-peasant is willing to receive, which means that we’ll have to call out the National Guard to stop wildcat strikes by workers who stop believing that it’s okay after doing so much with so little to be asked to do everything with nothing (much as they’re doing in China now to stop workers from rioting). And in case you’re wondering, I’m not a socialist, but a Social Democrat, a party that could caucus in a phone booth if only (1) we had a party, and (2) there were still phone booths.