Economists at CoreLogic recently released a report looking at economic recovery since the Great Recession December 2007 through June 2009. One of the key indicators of the health of the housing since that time has been home price appreciation. With booming job markets, low interest rates and increasing rents buyer demand has been high and nationwide prices have appreciated by 37.4% from December 2012 to December 2017.
Home price appreciation varies significantly by state as you can see in the map below, ranging from a high of 66% in Nevada to only 5% in Connecticut over that same five-year period. Minnesota’s average home price appreciation was slightly below the national average, at 31%. Home price appreciation for the Twin Cities metropolitan area was slightly above the national average, at 40% for the same five-year period from 2012 to 2017. Contact us to find out what is happening in your corner of the Twin Cities market.
Does this mean another housing bubble is forming? Most experts say no. The reason for the current price appreciation is due to the natural laws of supply and demand. The current housing shortage is creating a natural increase in prices, not a bubble in prices. The time to worry is when the imbalance shifts from a seller’s market with low inventory to a buyer’s market with a high percentage of unsold inventory. We have a long way to go before we reach that point.
RE/MAX Results HomesMSP Team – info@homesmsp.com
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