With the arrival of 2015, some are pontificating about a potential change in interest rates. With virtually no inflation, rates will likely remain low for most of 2015 but could flirt with 5.0 percent toward the end of the year. Construction permits and housing starts have upward momentum, which is news in some areas but familiar in others. Prices should continue their ascent but at a tempered pace compared to recent years, which helps preserve affordability for first-time buyers.
Closed Sales decreased 5.5 percent for existing homes and 5.2 percent for new homes. Pending Sales decreased 25.4 percent for existing homes but increased 11.9 percent for new homes. Inventory decreased 13.0 percent for existing homes but increased 20.4 percent for new homes.
The Median Sales Price was up 5.6 percent to $146,225 for existing homes and 3.2 percent to $324,900 for new homes. Days on Market decreased 8.5 percent for existing homes but increased 35.4 percent for new homes. Supply decreased 13.7 percent for existing homes but increased 19.0 percent for new homes.
Interest rates remain attractive, even as Federal Reserve banter is finally hinting that quantitative easing is reaching its fateful conclusion. Capital markets have exhibited some volatility, but ultimately it’s all about earnings and growth, and corporate earnings have been encouragingly strong, while private job gains have recently exceeded expectations.
*Market information courtesy of Kansas Regional Association of Realtors and Heartland MLS.