Maybe It's Time To Sell...
- Charles "Skip" Geiser
- Dec 11, 2024
- 3 min read
You may be wondering if home prices are going to crash. And believe it or not, some people might even be hoping this happens so they can finally purchase a more affordable home. But experts agree that's not what's in the cards – and here's why.
There are more people who want to buy a home than there are homes available to purchase. That’s what drives prices up.
Let’s break that down and explore why, nationally, home prices aren’t going to be coming down anytime soon.
Prices Depend on Supply and Demand
The housing market works like any other market – when demand is high and supply is low, prices rise.
According to the latest estimates, the U.S. is facing a housing shortfall of several million homes. That means there are far more people looking to buy (demand) than there are homes for sale (supply). That mismatch is the key reason why prices won’t fall at the national level. As David Childers, President of Keeping Current Matters (KCM), puts it:
“The main driving force on pricing is the limited amount of inventory in most markets across the country. That issue is not going to be solved overnight or in the next twelve months.”
How Did We Get Here?
For over 15 years, homebuilders haven’t been building enough homes to keep up with buyer demand. After the 2008 housing crisis, homebuilding slowed significantly, and it’s only recently started to recover (see graph below):
Even with new construction on the rise over the past few years, builders are playing catch-up. And according to AmericanProgress.org, they’re still not even keeping up with today’s demand, let alone making up for years of underbuilding.
And as long as there’s a housing shortage, home prices will remain steady or increase in most areas.
What About Next Year?
The majority of experts agree prices will keep rising next year, but at a much slower, healthier pace (see graph below):
But it’s important to note home prices vary by market. What happens nationally might not reflect exactly what’s happening here. If our local market inventory grows, prices could grow more slowly or even decline slightly. But in areas where inventory remains tight, prices will keep climbing – and that’s what’s happening throughout most of the country.
Bottom Line
If you’re wondering what it’ll take for prices to come down, it all goes back to supply and demand. With inventory still limited in most markets, prices are likely to remain steady or rise.
To see what’s happening with home prices where we live, let’s connect. That way you’ll have help understanding our market and making a plan that works for you.
Total Active Homes For Sale
In Escambia and Santa Rosa County
2992^ (+4)
Above $600,000
518v (-3)
Between $500,000 - $599,999
175v (-1)
Between $400,000 - $499,999
377v (-2)
Between $300,000 - $399,999
825^ (+2)
Between $200,000 - $299,999
777^ (+6)
Between $100,000 - $199,999
297^ (+5)
Under $99,999
23v (-1)
RED is UP Black Remained the Same Green is DOWN
Current Mortgage Rate
30 YR Fixed 6.78 % (+.06%) 15 YR Fixed 6.09% (+.010%)
Current Mortgage Rates
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This article provides information and opinions but is not meant as investment advice. Skip Geiser LLC, Charles "Skip" Geiser or Plum Tree Real Estate Marketing does not assure the accuracy or completeness of the information or opinions presented here. It is important to conduct your own research, due diligence, and seek professional advice before making any investment decisions. Skip Geiser LLC, Charles "Skip" Geiser or Plum Tree Real Estate Marketing is not responsible for any loss or damage resulting from relying on the information or opinions in this article.
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