Looking for extra storage in your house? The Wilmington, NC area offers some great small housing options with historic homes and seaside cottages.
According to Merriam-Webster normal means conforming to a type, standard, or regular pattern; characterized by that with is considered usual, typical, or routine.
Well maybe we are seeing a new normal start to emerge...but based on this definition we will need to see where the market goes from here before we make a determination if this is normal or not. But right now...this is not a normal market.
Lets look at five key housing industry metrics, and you will see that we are still nowhere near normal...
Looking at the 30-year mortgage rate, as chronicled by Freddie Mac, we can see the average rates by decade:
- 1970s: 8.86%
- 1980s: 12.7%
- 1990s: 8.12%
- 2000s: 6.29%
- 2010s: 4.09%
Today the average mortgage rate stands at about 2.87% - which while not quite a historic low, it is pretty close.
So no, current mortgage rates are anything but usual, typical, or routine.
Home Price Appreciation
According to Black Knight, a housing data and analytics company, the average annual appreciation on residential real estate prices since 1995 has been 4.14%.
According to the latest forecast from the National Association of Realtors (NAR), home price appreciation will hit 14.1% this year, which will be greater than any year since Black Knight began collecting this data.
Nope, home price appreciation is anything but usual, typical, or routine.
Months Supply of Inventory (aka how many homes are for sale)
Months’ supply refers to the number of months it would take for the current inventory of homes on the market to sell given the current sales pace. Historically, six months of supply is associated with moderate price appreciation, and a lower level of months’ supply tends to push prices up more rapidly.
As of the latest Existing Homes Sales Report from NAR, the current months’ supply of inventory stands at 2.6. That’s less than half of a normal supply. In looking at our local data, this supply is much lower in the Wilmington, NC Area, when you consider the average price point of our clients. While there is more supply now then at the beginning of the summer (our typical busy season) there is still very low inventory of home in the area.
The months supply inventory is not usual, typical, or routine.
Days On Market (aka how long it takes to sell your home)
The days-on-market metric gives an indication of how hot a market is and how quickly homes are selling. In 2019, prior to the pandemic, the average days on market stood at 35, according to NAR. Today, that number is cut in half and is now at 17 days.
Nope, another metric that is not usual, typical, or routine.
Number of Offers per Listing
According to NAR, the number of offers per listing stood at 2.2 in 2019. Today, that number is double at 4.5.
So another metric that is not usual, typical, or routine.
When... mortgage prices are a near historic lows, price appreciation is at historic highs, housing inventory is low, the time it takes to sell a home is cut in half, and there are twice as many offers on each house...