The experts have been waiting for the Big Burst for about two years now. They are convinced it could happen any day but this bubble keeps on getting bigger and shows no sign of letting up. It has been the fastest period of housing price growth in recorded history – even outpacing the housing bubble of 2008. The average price of a home in America has increased 16.2% to a mind-boggling $374,000.
Hawaii is the most expensive state; the average price of a home there is $636,451. Next is Washington D.C.- $626,911. Then California -$554,886. The cheapest homes are in Mississippi- $126,502 and West Virginia – $108,236. For a full list of states, click here…
Even though there was a deceleration in November and December – Forbes was calling it the Great Deceleration – it was short-lived because now the consensus is home prices will keep going up and in Spring, they will spike 22% and absolutely crush buyers. Our Email List will help you to reach the targeted people, which helps us to market our product and increases the revenue.
Why are prices so high? Inventory is low, and so are mortgage rates. As of December, there were just 1 million homes listed for sale on Zillow – down 17.5% from December 2020. The cost of building is through the roof. New construction can range between $100 and $200 a square foot. Lumber prices alone add about $36,000 to the price of a new home. But, as long as demand is high and inventory is low, home prices will remain high.
So, is the bubble going to burst or what? With inflation soaring, a rise in interest rates, and the war in Ukraine, it is very possible. But our belief is that it will not “burst” – it will level off to a more sustainable median price sometime in mid-2022.