The average home prices in the United States have increased dramatically in the past 12 months. Some areas, like Phoenix and Scottsdale, are seeing prices skyrocket. The increases are due to an increase of sales and a tight supply of homes that are available.
According to Standard & Poor’s/Case Shiller 20-city home price index, the annual gain the past 12 months has been the biggest yearly gain in six years.
Nearly every city – excluding one – saw an increase on the index; Phoenix noted the largest gain with 23 percent. In San Francisco there was a 12.7 percent price increase and an 11.9 percent increase in Detroit. New York was the only city that saw a decrease.
In 10 of the cities, prices increased from October to November, which is an increase of three from September to October. The biggest gains were seen in Minneapolis, Phoenix, and San Francisco.
The housing recovery should be fueled by the steady price increases, which tempts more folks to purchase homes before they increase even higher. High prices tend to build a homeowner’s wealth, which also leads to additional economic growth and spending.
According to an economist with Barclays Capital, the information shows a general-based recovery in both prices and housing activity around the nation. The housing recovery is expected to continue in the next few years.
Although housing prices have started to rebound, they are still approximately 30 percent below their peak in the summer of 2006 before the housing bubble burst. Today’s prices are at 2003 levels.
More people are buying homes due to the record low mortgage rates and the gains in stable jobs. A limited number of homes for sale have also encouraged home builders to increase construction.
Still, millions of homeowners are underwater with their mortgages, which makes it hard for them to sell. That’s the key reason why home supply is so tight. Of course, the higher home values helps in getting more homeowners out from underwater and encouraging them to sell their home.
If you are considering purchasing a home in Scottsdale, now is the time to jump off of the fence. Prices are rising and the longer you wait, the more you will pay. Call me to schedule an appointment to view homes or condos in Scottsdale.
Carmen Brodeur JD
Trillium Properties, LLC
9825 E Bell Road, Suite 120, Scottsdale AZ 85260