U.S. Homes Hit Record High Prices

U.S. home prices hit the biggest annual increase in May, since 1999, with a shortage of properties and low borrowing rates fueling demand.  The median home price increased nearly 24% from the year before.  Sale prices increased dramatically due to the pandemic as people rushed to find more space and bigger homes.  

This price increase is contributing to a decrease in home sales.  There are fewer homes on the market and therefore not enough to meet demand.  This is squeezing out buyers with limited cash for a down payment.  Mortgage applications have decreased, showing that buyers are waiting longer to purchase a home.

Even with buyers waiting, the housing market is doing well. Homes are getting multiple offers and more than half are sold above their asking price. Investment firms are also buying up homes and renting them out and builders attempting to build more to meet demand. The housing market is tough for first-time and low-income buyers but strong for the top, with sales of homes over $1 million doubling in the last year.

source :

https://www.wsj.com/articles/u-s-existing-home-prices-hit-record-high-in-may-11624371222

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