January 1st - December 31st 2014 there were 728 Homes Sold at an Average Sale Price of $149,408.
January 1st - December 31st 2015 there were 797 Homes Sold at an Average Sale Price of $161,742.
Miller Real Estate and our team of Agents have felt a significant increase in the market overall. The increase in average sold price, increase in number of sales and decrease in distressed listings, creates a clearer picture for analysis on your current market value. For the past 4+ years most of the increase in average sales price was in part due to the decrease in active foreclosure listings. Last year there were fewer foreclosure listings than in the past, which better represents the increase in the market as a whole. The above data shows us an 8% increase in overall market value.
In December the Federal Reserve announced it was increasing the federal funds rate from 0 to a target rate of .25 to .50 percent. While this created a lot of media buzz and worried buyers, the 30 Year Fixed Mortgage Rate has not jumped dramatically and is still at all time lows. Click link HERE to see a chart showing rates since 1971.
The Mortgage Interest Rate has a lot of effect on overall values, especially when it comes to what price range a buyer is able to purchase in. The 2 data points below, may help paint an accurate picture of why the rate is so important.
1. Low Mortgage Interest Rates have fueled some of the increase in Average Sold Price as buyers are able to afford more. Take for example the graph below....
Analysis: Lets say based on your debts, you can afford $1,200 a month, not including taxes, insurance and etc. If the rate is at 4.5%, you can afford a property around $285,000. If that rate jumps to 6%, you can now only afford closer to $250,000.
2. As Mortgage Interest Rates will most certainly rise over the next 2-4 years, buyers will find themselves not being able to afford higher priced homes. Sellers sell at what a buyer is willing to pay in the current market. If the rates do rise, the sellers in the future may find themselves dropping prices accordingly to where the buyers are able to afford.
This creates a great time to sell and buy! Rates are still historically low, purchasing a home allows build up of equity and holding that valuable asset is still desirable. Rental vacancies are at an all time low, while rental rates are at an all time high. If you don't know where to start, make sure you get in touch with one of our Agents today!
If your thinking of selling, now may be the time to get a Free Market Analysis and be ready while the time is right!
Miller Real Estate, serving Barry County for over 75 Years!