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Low supply and high demand driving up home prices

On Behalf of | Jul 10, 2018 | Residential Real Estate

People shopping for homes in Delaware are likely to encounter rising home prices. A nationwide imbalance between the numbers of sellers and buyers has acted to increase listing prices and shorten the time that available homes spend on the market. A report produced by the data and analytics firm CoreLogic recorded a 1.1 percent increase in home prices between April and May 2018. Since May 2017, home prices have gone up 7.1 percent. CoreLogic predicts that by May 2019, home prices will have gone up by another 5.15 percent.

A survey conducted by CoreLogic and RTi Research found that 41 percent of renters aspire to buy a home in the next 12 months, but only 11 percent of current homeowners have any plans of listing their homes for sale. With such a constrained supply of single-family homes, buyers can expect little relief from rising home prices. An economist at CoreLogic said that the supply of entry-level homes is especially tight.

The company’s report about current market conditions across the nation’s 100 largest metropolitan areas identified 40 markets that had become overvalued, meaning that home prices have exceeded by at least 10 percent a long-term sustainable level. Renters in these overvalued areas expressed the greatest desire to pursue homeownership on the survey.

Both buyers and sellers have to consider market forces when making a decision about a residential real estate transaction. When considering a specific deal, seeking the advice of an attorney might be an appropriate step when a person has questions about a purchase agreement, title irregularity, zoning or a short sale. An attorney might be able to alert a person to potential liabilities and strive to solve problems, like a lack of disclosures or disputed contracts, by negotiating with a third party or preparing litigation.