Tuesday, November 27, 2012
The peak of house prices in our market was 2008. The average sales price of a detached house during the first 11 months of this year is down +/-9% compared to the same period in 2008. The average monthly rent of a detached house is up 3%. Rising rents typically push shelter seekers into home ownership. While national rents are rising at a higher rate than local, the upward trend still exists. The average 30 year fixed mortgage rate in 2008 was 6.65%, the current average is 3.09%. This dramatic drop in interest rates, combined with lower house prices and stable to increasing wages has produced unprecedented housing affordibility. While I would expect these trends to continue in the near future, the great unknown is whether our national political leaders can figure out a solution to the fiscal cliff.