Interest rates are going up and prices are going up.  When we start to describe the market it is always "is this buyer’s versus seller’s market." This goes all the way back to 1999. Do not worry, we’re still very much in a seller’s market. And we do not foresee a shift at that to shift to a buyer’s market any time soon. But expect some of the frenzy to cool off in the coming months in the second half of this year. 

However, no doubt as we start to shift our turn – shift we will shift focus from buyers to sellers – no doubt American home equity is skyrocketed. This is the latest data from CoreLogic. The average gain in equity on a mortgaged home over the past year - $33,400. Significant gains in equity across the country. 

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Here is an in depth look at forecasts and we will talk about what we see from experts. Some of the challenges we could see in the second half of the year.

First, we’ll start off with rates. Mortgage rate projections. The quick answer here is mortgage rates are projected to go up. When we look at this – by the middle of next year this average, all of these four forecasters, about three and a half percent. A little over three and a half percent. And is it going to be there? Is it going to be a little bit higher or a little bit lower? Time will tell. The only question really is by how much our rate is going to up and by when. And that’s what we’re dealing with. 

Certainly, if you’re somebody who’s buying right now – we are here to help you understand that the forecast for rates is going to up and why. It’s going to cost more in the future to borrow the money to buy a home. What about prices? Let’s look at the most up to date forecasts for prices going into the second half of this year. The average of these five forecasters – Zelman, NBA, NAR, Fannie & Freddie – 8.9%. 

The one thing all of these forecasters have in common is that every one of them has raised their forecasts as we’ve gone throughout the year. 

We started off this year – the average of these forecasters was about five percent. Really that was based upon more inventory coming into market which we have yet to truly see for a while now. Now they’ve upleveled their forecasts knocking on the door again of another year of close to 10% if we don’t see double-digit appreciation in the year. It is now extremely likely that they would upgrade their forecasts as we go throughout the year again. However, it is all going to be dependent upon inventory. It is always important to  keep an eye on that. 

Overall, We need more homes available for those who want to buy them. As we move into 2022, these forecasts as well. As less than or better than what we saw last year at six and a half million homes. So we look forward to amazing home sales for this year and for next year also.  

When it comes to affordability what stands out to you are the homes that were so, so affordable during the housing crisis. Remember the way you read this – the higher the index, the higher number, the more affordable homes were. And you can see the years when distressed properties dominated the market, homes were very, very affordable.

So when somebody mentions – homes certainly aren’t as affordable today as what they’ve been in the past. Your first question should be – as compared to when? As compared to the last two years? Well yeah I can see that here graphically. Homes aren’t as affordable today as the last two years. But three years ago? No they’re actually more affordable. This is a great thing! 

Now people may ask about time prior to the housing crisis? They’re actually more affordable today. The time during the housing crisis? Not as affordable. So we want to be educated on this. We want to be able to have those perspectives. 

“Many find it hard to believe, but housing is actually undervalued in most markets. And the gap between house buying power and sales prices indicates there’s room for further house price growth in the months to come.” So what’s he saying? There’s room for homes to go up in price. As they measure affordability, house buying and houses are actually undervalued in most markets. Not something we’re hearing a lot out there. But when you start to look at the numbers, that’s very apparent.

 Now, how we’ve always looked at this – I keep in current matters, and bridge builders is – looking at Housing Affordability Index. If we look at the housing affordability index – that’s produced by NAR – you can see where we stand today. Now, if you haven’t seen this, the higher the index is the more affordable a home is. And where do we stand today? We stand in a very, very good position. Homes being more affordable almost going all the way back to 2012, 2013 in what the dollar will buy. 

Now what stands out are the area in the middle there - where for the years were distressed properties dominated the market after the housing crash. But very, very good affordability relative to what the dollar will buy. If you want to look at that visually, the percentage of median income needed to purchase a median price home historically is about 21.2%. Back in the housing crash that rose to about 25.4%, and today we sit at 14.4% on average. The median income needed to purchase the median priced home. 

In the Town of Plymouth, home sales have increased through the month of June from 29 homes in May. The Average Days on Market remained relatively steady at less than one months time. The the Average Sale Price has been steady around 500k the last three months. We are seeing more homes on the market in June as the current homes for sale has increased by 9. 

In the Town of Scituate, the Average Sale Price has increased by 100k although with less offerings in the last 30 days. Home sales have stayed relatively the same month over month as well as less days on the market for the month of June. 

In the Town of Kingston, the number of new offerings has increased slightly over the last three months. The number of homes sold has increased since the month of May.  The Average Sale Price has continued to stay relevantly in the high $500K to the mid-$600K range. 

In the Town of Norwell, the Average Days on Market have significantly improved to 8 days compared to May which was 38.  The number of homes for sale has increased since the month of May The Average Sale Price although has remained in the $900k bracket over the last two months. 

In the Town of Hanover, the number of homes sold increased from 7 in April. The Average Days on Market has decreased significantly from 76 days in April to 12 days in June.  The average sales price has increased from $600K to $750K. 

In the Town of Hull, the number of homes sold has increased increased by 7 since April. Homes entering the market have remained consistent and there is still a very limited amount of  available inventory.

The Average Days on Market have dramatically decreased from 58 days in February to 8 days in June. The Average Sale Price has increased from $499k in February to over $600k last month.

In the Town of Sandwich, the Average Days on Market increased while the number of homes sold remained fairly consistent.  Currently there are 35 homes for sale compared to last months 24 meaning the inventory has stayed relatively the same. 

In the Town of Falmouth, the Average Sale Price has decreased from $986K in April. With limited inventory in most towns, there are still a good amount of new homes entering the market as we moved through the month of June although resulting in a decrease the past month. The number of homes sold has increased from the 30's to the 50's.

In the Town of Yarmouth Port, inventory has decreased since the month of April compared to April's 51 new offerings. The average sale price had decreased along with the inventory.