Are Home Prices Too High?admin
A lack of new construction in the last 10 years may actually be a blessing in disguise. For now, that is.
I’ve been getting a lot of questions lately about home prices. Are they too high? Is the market overheating? I think people are overreacting just a little bit. Here’s why.
As you can see on the chart in the video above, the number of new construction homes being built has moved up and down in cycles for the last 60 years. The gray lines on the graph show our recessions.
If you look closely, you’ll see that we’ve built less than 1.2 million new homes in the last 10 years. We’ve never had another 10-year period where we built less than 1.2 million. We’ve occasionally dipped below that, but those dips have never lasted longer than 18 months.
“If you don’t already own a house, you need to.”
Another topic I get asked about a lot is inventory. The reason it’s so low right now is because we haven’t built enough homes in the last 10 years. Homes are going to continue to go up in value as long as this is true.
If you don’t own a house already, you need to. If you have any questions at all about buying or aren’t sure what you can afford, give me a call or send me an email. I would be glad to help you out.