Home prices continue to rise, the supply and demand levels on the housing market are still imbalanced, and the spring peak buying season is nigh. Several housing economists predict that buyer competition will be tighter than usual.
“We can expect the usual seasonal bump of would-be homebuyers to compete over a shrinking pool of homes. In a twist, this year’s buyers may be competing against some of those buyers who have been unsuccessful during the past few months," says Zillow Senior Economist Aaron Terrazas. HousingWire reports that according to Genworth Mortgage Insurance chief economist Tian Liu, "over the past 12 months, low-tier homes have outperformed the aggregate [price] index significantly, while high-tier homes have under-performed,” suggesting that starter home demand and supply levels are resulting in greater price increases.
However, not all experts expect home price growth to continue at its current rate. “That is the first time annual growth has fallen since June 2016, and supports our view that house price gains peaked at the end of last year,” Capital Economics Property economist Matthew Pointon said. “We expect growth will continue to ease gradually this year, although tight market conditions and rising household incomes argue against a sharp slowdown.”
