Back in May of 2021, the housing market was on fire. It was similar to the mid-2000s except for one difference, every town was experiencing it. Candace Taylor wrote in the Wall Street Journal that buyers far from big cities lose out to investors and deep-pocket rivals in places where properties until a year ago offered affordable entry to the middle class…(Wall Street Journal)
- “Bidding wars have spread from such high-profile locations as Palm Beach, Fla., and the suburbs outside New York City to smaller cities and towns, including long-neglected locales where properties typically sat on the market for months.”
- “Jonathan Campbell, vice president of DLP Realty in Bethlehem told the Wall Street Journal, “‘If you’re a buyer, this is the most frustrating time,’ Mr. Campbell said. The local market, he said, is outpacing the mid-2000s housing boom.“
However, just one year later we now hear that maybe things weren’t as hot as we thought. Nicole Friedman & Ben Eisen at The Wall Street Journal writes that in 477 cities, the typical home value at the end of April was below peak levels from the early 2000s…(Wall Street Journal)
- “The current boom has been unusually widespread…But in Detroit, a typical home was valued at $66,015 at the end of April, below the city’s August 2006 peak of $74,180. And in Chicago, the typical home value of $315,196 in April sits just above the city’s March 2007 peak of $314,917.”
Friedman and Eisen point out that homeowners who bought in these cities during the last peak still would be unlikely to sell for a profit today especially when adjusted for inflation.”
As I continue to say, the national numbers can be very misleading. Just remember, all real estate is local.