Is the housing market improving, or is it a head fake?


Data show where the housing market is, but the pundits and economists are deep into competing outlooks about where it’s going.

Here’s a capsule of the latest with links to the full report for those who want more info.

NETAR March Home Sales

Sales up 43% from Feb. while prices gave up some ground.

The median sales price of $235,000 is up 5% from last year and 6% off the peak price set May last year.

Indicators show demand is increasing. But not all sellers have come to terms with the fact they won’t be getting 2022 prices this year. Sellers did less discounting in March and some buyers are not willing to pony up for what they considered over-priced homes. New home inventory is coming online at a steady pace.

Local fundamentals are not showing signs of weakening. First quarter annualized wages are up 8% and the labor market isn’t showing signs of weakening. From a trends perspective, it looks like this year’s prime buying and selling season will be in line with the local pre-pandemic patterns.  The 2019-2018 price improvement was in the 5% and 7% range. The region’s historical appreciation rate is almost 3%. A conservative outlook – based on current conditions – would be in the 3%-4% improvement range.

Full report and drill down on county, city and community submarkets at https://netar.us/march-home-sales-increase-prices-dip/

Here’s the pundits’ outlooks:

Zillow thinks U.S. home values will rise by 0.5% between Jan. 2023 and Jan 2024 while Moody Analytics expects prices to fall 4.2%. Here’s their outlooks for the Tri-Cities’ two metro areas:


Jan. 2023-2024 Johnson City metro prices up 3.9%. Kingsport-Bristol prices up 3.9%.

Zillow thinks price declines have already bottomed out and may help entice more buyers this spring.

Tight supply will make it hard for home prices to fall much heading forward.

Moody’s Analytics

Expected shift Q4 2022 and Q4 2023. Kingsport-Bristol outlook is for a 6% decline. The Johnson City metro area outlook is for a 2.4% decline.

Moody’s expects a decline because “prices are simply too far detached from underlying fundamentals like incomes.”

The Zillow and Moody’s update in Fortune can be found at https://bit.ly/3zLdWFt


Categories: REAL ESTATE