A record glut of houses for sale in Mass. should send prices tumbling
Or, so says Kimberly Blanton, in today’s Globe.
You would think so. I mean, as I often say, housing prices are a matter of supply and demand, right?
So, if there’s a built-up supply of inventory (is that redundant?), then sellers will need to start lowering the prices of their homes and condos, in order to get them sold, right?
It makes sense, but, at least until now, prices have NOT come down. In fact, they’ve continued to rise, although at a lower rate of appreciation than in other years.
In fact, most economists predict price increases over the coming year, and beyond.
I think a lot of those economists conclusions are based on the belief that the Federal Reserve will stop increasing interest rates, next month, or the month after, since the rise in rates seems to have tempered the risk of inflation (and also because there’s a mid-term election coming up).
Because interest rates will moderate, but the economy will continue to improve, people will have more income to spend on things such as home purchases. I think this is why they believe prices will continue to rise.
It doesn’t seem quite logical when you look at the facts, though, does it. I mean, 55,000 properties on the market in Massachusetts sure makes it look like things are going to change, right?
We’ll see.
More information: Buyers’ Market - By Kimberly Blanton, The Boston Globe
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