Inflation Now Impacting Housing Markets
Some housing supply appears to be increasing but it does not seem to be having a measurable impact upon the price of homes nationwide.
Cash sales have hit their highest level of all total sales, accounting for 28% of all transactions. This represents a new all-time high.
Now the prices for homes in the $750,000 range saw a 30% rise in the average price year-over-year, and homes listed above $1 million saw an even bigger jump, to 30% year-over-year. The homes in the $100,000 – $250,000 climbed 21% year-over-year.
Even with the rise in prices and the higher interest rates for home mortgages, homes are selling on average in just 17 days, as compared to the 18 days on market for 2021.
Building permits are rising, but not enough to replenish the inventory that has been decimated by the most ferocious sellers’ market in recent real estate history.
Inflation still represents a headwind that we have yet to measure the true consequence of its impact. With gas prices hitting all-time highs, Americans are expecting to pay $700 more per year to drive.
The average price of gas hit an all-time high this past March, reaching $4.33 per gallon, still over 40% higher than a year ago. Soaring inflation and gas prices are hurting Americans, especially those with low to moderate incomes.
One year ago, this would have cost about $1,700 a year. With the recent surge in gas prices, Americans will now pay over $2,400 for the same number of miles, or $700 more per year. This comes out to about $60 a month.
Even with the release of emergency oil reserves, prices are expected to remain high, already costing Americans thousands of dollars more for necessities such as gas and food. According to the Department of Energy, gas mileage is decreasing, especially as drivers try to make up for lost time and wages by speeding up on the road. All of this is impacting the family’s budget and ability to meet the cost of maintaining an average house.
But this is heading higher, much higher: a typical American spent on their mortgage each month a median of $1,609 in 2019. And in New Jersey, the average is $2,413, just coming under pricey California’s $2,421.
If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.
Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.