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Why are home prices still rising?

By in Tri-Cities Housing Market with 0 Comments

Home prices have risen nationally for six straight years. It’s true. The National Assn. of REALTORS® recently tweeted this amazing statistic: Median home prices in the U.S. have risen on a year-over-year basis for 72 consecutive months.

Home prices are rising locally, too. The median home price in Benton & Franklin counties was $198,000 at the end of 2014, and rose to $251,100 at the end of 2017.

Why are home prices still rising? It’s a simple answer: There are more purchasers in the market right now than there are available homes for them to buy. This is an example of the theory of “supply and demand” which goes like this:

“the amount of a commodity, product, or service available and the desire of buyers for it, considered as factors regulating its price.”

When demand exceeds supply, prices go up. This is currently happening in the residential real estate market.

Here are the national numbers for supply and demand as compared to last year for the last three months (March numbers are not yet available):

In each of the last three months, demand (buyer traffic) has increased as compared to last year while supply (number of available listings) has decreased. If this situation persists, home values will continue to increase.

Conclusion

The reason home prices are still rising is because there are many purchasers looking to buy, but very few homeowners ready to sell. This imbalance is the reason prices will continue to rise.

If you’ve been thinking about selling your home, now might be a great time. I can do a market analysis to help you understand what your home might be worth in today’s Tri-Cities real estate market. Get in touch below — it’s free and there’s no obligation.

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About The Author
Cari McGee

My husband and I came to the Tri-Cities in 1994, and we thought it would be a temporary stop on our way to larger cities. He was a television sports anchor at the time, and we planned to go wherever the "next step up" took us. Twenty-plus years later, we're still here and we've loved every minute of it! We have two children now, and we've found the Tri-Cities area is a wonderful place to raise a family. It's a great place to do outdoorsy things -- I like to hike Badger Mountain or run along the river path. I also love reading ... by a cozy fire in the winter or a beautiful picture window in the summer (with the A/C on!). I've been a licensed Realtor since 2004. I earned my managing broker's license in 2016, which means I can run my own brokerage, or create a team of real estate agents and supervise them, which is exactly what I did when I formed the Cari McGee Real Estate Team in 2018! We have administrative and marketing personnel, as well as additional agents to serve you. I became a director of the Tri-Cities Association of Realtors Board of Directors in 2016, became Secretary/Treasurer of the organization, and was elected to Vice President in 2019. Want to talk about real estate? Click here to schedule a meeting with me!

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