Every quarter the S&P/Case-Shiller National Home Price Index comes out. For the period ending in October it was up .7% from the previous quarter and year over year up 6.2%. Prices rose in more than half of the country led but San Francisco and Las Vegas. Builders are upbeat, supply is tight and prices are rising as the millennials begin to enter the housing market.
However, all may not be so rosy in 2018. Though there are reasons to think that the good times will continue, the Federal Reserve has stated they will raise interest rates three times in the New Year and while they do not control the mortgage rate there will be upward pressure on rates. Higher home prices and higher mortgages will reduce the pool of new home buyers. Also, there is an unknown consequence that might be coming from the new Federal income tax law. Deductibility of higher priced home’s property tax could alter buying patterns in high income tax and property tax states.
The New Year will bring changes, we are just not sure what they will all mean for home buyers.