The number of NSDCC detached sales in June hasn’t quite caught up to last year’s total yet, though this June had one less business day:
Last month’s average number of sales was 16.25 per day, the highest daily average of June closings since 2004. Prices have been surging too; let’s compare to the last peak.
The previous boom had been gradually picking up steam since the tun of the decade, and in 2003 went into overdrive, fueled by the neg-ams and no-doc qualifying. Pricing went on a two-year bender:
In the period between January, 2003 and January 2005, average pricing increased 46%. But once we got around $475/sf, the trend took a right turn and stayed in the $450/sf to $500sf range until mid-2008.
Low rates and prices have caused a similar frenzy, are we on the same path?
Between June, 2012 and June 2013, average pricing increased 23% – the same velocity as the last surge (half as much, in half the time). It also gets us into the same range where prices flattened out previously.
If the trend were to continue for the full two years like last time, it would get the NSDCC average pricing up to around $537/sf, which sounds astronomical.
With higher rates and prices, it would make more sense that the trend would moderate, and probably stay in a similar range of $450/sf to $500/sf for the foreseeable future.