New residential real estate activity has been relatively slow in the first quarter of 2018, yet housing is proving its resiliency in a consistently improving economy. Some markets have had increases in signed contracts, but the vast majority of the nation continues to experience fewer closed sales and lower inventory compared to last year at this time. Despite there being fewer homes for sale, buyer demand has remained strong enough to keep prices on the rise, which should continue for the foreseeable future.
New Listings were up 3.9 percent to 774. Pending Sales increased 20.2 percent to 606. Inventory shrank 8.3 percent to 2,189 units. Prices moved higher as Median Sales Price was up 2.3 percent to $301,870. Days on Market decreased 9.1 percent to 140 days. Months Supply of Inventory was down 18.5 percent to 5.3 months, indicating that demand increased relative to supply.
The Federal Reserve raised its key short-term interest rate by .25 percent in March, citing concerns about inflation. It is the sixth rate increase by the Fed since December 2015, and at least two more rate increases are expected this year. Borrowing money will be more expensive, particularly for home equity loans, credit cards and adjustable rate mortgages, but rising wages and a low national unemployment rate that has been at 4.1 percent for five months in a row would seem to indicate that we are prepared for this. And although mortgage rates have risen to their highest point in four years, they have been quite low for several years.
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