Rehoboth Beach Real Estate Blog - Home Prices

Future Values of Rehoboth Beach Area Homes? Simple as Supply and Demand

Posted by Bill Mann on March 10th, 2013

Pricing in today’s Rehoboth Beach real estate market, as it is in the markets for every other saleable item, will be determined by the concept of ‘supply and demand’.

According to dictionary.com:

“The relationship between supply and demand determines the price of a commodity. This relationship is thought to be the driving force in a free market.”

In real estate, supply and demand is represented as the current month’s supply of homes for sale (the number of homes for sale divided by the number of homes sold in the previous month).

While there is no steadfast rule that will apply to pricing in every category of housing, here is a great guideline:

• 1-4 months supply creates a sellers’ market where there are not enough homes to satisfy buyer…

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House Prices: When Will 2006 Values Return?

Posted by Bill Mann on February 16th, 2013

There is a lot of optimism regarding house prices. The most recent Home Price Expectation Survey projects a 3% — 3.5% increase in values for each of the next 5 years. We concur that most parts of the country will see varying levels of appreciation over that time. However, we must realize that we will not see 2006 values any time soon.

Barclays’ U.S. residential credit strategy team recently predicted that 2006 values would return in 2021. From an article in DSNews:

“While the floor appears to have materialized, they stress that home prices are likely to recover slowly over the next 4 to 5 years.

“We expect on average a 3-4 percent annual increase in home prices [nationally] in coming years,” they said in an updated market outlook.

At that…

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What the Case Shiller Report is Actually Telling Us

Posted by Bill Mann on January 30th, 2013

Case Shiller released their latest Home Price Index yesterday. The headlines that followed were true but, in our opinion, a little misleading. Here are some of the highlights of the report that have dominated major media coverage:

• Home prices rose 5.5% in the 12 months ending in November 2012 (the latest data available).
• In the 12 months ended in November, prices rose in 19 of 20 cities.
• Housing is clearly recovering. Prices are rising as are both new and existing home sales.

Great news for the housing industry. Realize however that all the highlights mentioned above refer to year-over-year comparisons.

What is NOT Being Reported

There is another finding in the report that hasn’t garnered many headlines – month-over-month prices are…

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27 Months Of Consecutive Job Growth Helping Home Prices Rise

Posted by Bill Mann on January 9th, 2013

The Bureau of Labor Statistics (BLS) Non-Farm Payrolls report for December exceeded Wall Street's expectations by 5,000 net new jobs, showing 155,000 positions created in December.

The December tally raised the economy's 12-month total to 1.84 million net new jobs created nationwide. Jobs added in December mark the 27th consecutive month of job growth.

Job sectors showing the strongest growth to close out 2012 included:

• Health Care
• Drinking and Eating Establishments
• Construction
• Manufacturing

Private-sector hiring is driving the jobs market, too. 168,000 new private sector jobs were added in December. Government jobs fell by thirteen thousand.

Monthly job creation has averaged +153,000 jobs since 12 months ago. It's a fine measure of…

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