Low Inventory = Higher Home Prices

While long term home prices continue to fall on an annual basis, the Home Price Index from Black Knight showed a 0.45% increase in home prices for the month of March.  Black Knight is the Data & Analytics company which provides the information for most of the property profiles provided by title companies.   This jump in home prices follows increases of 0.13% and 0.43% in January and February of 2023.  The trend over the last few months shows a future projection which could end with an annualized gain of almost 10% in home price growth for 2023.  Year over year from April of 2022 to April of 2023 reflects a net gain of only 1% growth in home prices nationwide.  Five months ago, home prices were declining in 92% of all major housing markets in the United States.  The trend over the last few months has done a 180-degree turnaround.  As of March of 2023, 92% of all major housing markets reflect home prices rising.  Data from Black Night shows the supply of active listings fell for the sixth straight month and are near the lowest levels since April of 2022.  90% of all major markets saw a decline in new listings in March of 2023.  Low inventory appears to be the driving factor behind the recent gains.  Chief Economist for the National Association of Realtors recently commented saying, “The lack of housing inventory is a major constraint to rising sales.  Multiple offers are still occurring on about 33% of all listings and 28% percent of homes are selling above list price.”