Thanks to just some guy’ for sending in this article comparing prices, rates, and inflation:

https://awealthofcommonsense.com/2021/03/what-if-housing-prices-arent-as-high-as-they-appear/

It’s a feel-good idea that inflation and lower rates can ease the pain of higher prices.  But recent pricing has been really painful for buyers!  Let’s apply the data to our local action (using 80% of MSP):

NSDCC Detached-Home Sales, February

Year
# of Sales
Median SP
Mortgage Rate
Monthly Pmt
2006
137
$833,000
6.25%
$4,103
2015
171
$1,110,000
3.71%
$4,092
2018
166
$1,289,005
4.33%
$5,121
2021
226
$1,736,000
2.81%
$5,714

It’s a nice idea, and higher rates did cool things down a bit in 2018. But today’s market is so explosive that we are blowing through all the usual stop signs – look at the number of sales!

My guess is that there will be additional sellers pulled forward from future years, just like with buyers – it’s too lucrative and tempting to find a way to sell now. Might it mirror the covid-recovery trend line?

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Jim the Realtor
Jim is a long-time local realtor who comments daily here on his blog, bubbleinfo.com which began in September, 2005. Stick around!

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